Hi, everyone. Thanks for joining us live on X.

I'm Alesia Haas, CFO of Coinbase, and I'm here with our co-founder and CEO, Brian Armstrong, and a few independent and institutional research analysts. If you haven't already, please head over to our IR website to watch the videos we posted of Brian and I discussing our quarterly results.

In this session right now, we are excited to directly connect with you, our customers, our community, our shareholders, and we want to talk about our quarter and answer questions. Just as a friendly reminder, we're not going to answer any questions on when XYZ token.

We have a robust asset listing process that we follow, and we're not going to talk about any customer support cases. Besides from those simple ground rules, it is open question time.

First up, I'd like to introduce Andrew.

Thank you very [much?] , Alesia and Brian.

It's a pleasure to be here. Appreciate the opportunity.

I thought maybe I'd start with a big-picture macro question, and I think you touched on it in the quarterly results. It does feel like crypto sentiment has shifted and we've seen Bitcoin rally a lot off of its lows, but it still trades like a risk asset.

Even aftermarket today with tech trading off, do you feel like the case for Bitcoin ownership broadly has evolved? It does seem to me that Base is certainly making the case that Bitcoin can really be global digital collateral in DeFi marketplaces, but could you maybe just comment on how you think sort of the raison d'être may have shifted?

Before you answer, Brian, I just wanted to apologize. Andrew, I should have given you a more robust introduction.

[laughs] So with us, with us folks, is Andrew Jeffrey, who is an institutional research analyst with William Blair. With that, Brian, over to you.

What is the BTC value proposition today in 2026?

I think it's evolving. You're right.

It's obviously still a store of value. We're super bullish on Bitcoin.

I think we just purchased our 18,000th Bitcoin, actually, on Coinbase balance sheet. Alesia has [laughs] a Bitcoin pillow.

Happy birthday!

It's Bitcoin's birthday coming up, too. Then I think what you're getting at is correct, which is now that you can use Bitcoin as collateral, it actually improves liquidity for trading, right?

That's improving DEX trading, for instance, with Bitcoin. A lot of our customers who were early in Bitcoin, they don't want to ever sell their Bitcoin, but they do want to use it as collateral.

Base, for instance, has done really well recently by growing its financing products. You can use that Bitcoin as collateral, get financing, go and do more trading.

It's pretty synergistic. I think that's definitely a big trend that's happening right now.

Then just broadly, I'd say in this cycle that we're in, it's always difficult to call these things exactly, but we are seeing volumes rebounding and more institutions coming in, onboarding. I think it's a exciting road ahead for Bitcoin.

I would just comment that we saw significant ETF inflows into Bitcoin specifically this quarter as people recognized that the price had stabilized. One, Bitcoin is still a critical asset to us, but we are Bitcoin and.

People can now trade a lot of things, and we've seen volatility come down in Bitcoin with the institutional adoption of this as an asset class. I think that that is providing it to be an important diversification in a lot of people's investment portfolios.

Thank you. Mine included.

I guess I'm not vain enough to have introduced myself. I probably should promote myself better.

I actually think the comment on diversification, I think that your business in particular, is really a good segue. Terrific sequential growth in prediction market revenue.

One of the questions we get a lot is the trends in consumer transaction revenue and take rate. I'm sure you hear this a lot, too.

Could you help us parse a little bit how much it certainly looks like prediction markets cushioned consumer transaction revenue in the quarter, but can you help us sort of unpack that a little bit and tell us maybe how we can think about that going forward?

Absolutely. Prediction markets is one of our fastest growing new revenue products.

We just launched it in February this year, and during the third quarter, it crossed $200 million of annualized run rate revenue. What's great about that is this is a market where overall spot crypto trading was actually down.

We saw overall crypto spot trading volume down 10% quarter-over-quarter. The growth in prediction markets offset the decline in overall spot trading, and we delivered flat revenue quarter-over-quarter.

The mix shifted considerably. When we look at the mix of our overall revenue, it's really interesting to look at this quarter.

Predictions plus derivatives, those two combined, were about 25% of our total transaction revenue. If I look at then our total revenue, subscription and services was roughly 49% of total net revenues.

We are seeing the investments that we've made over the past few years to really diversify our revenue really come to our benefit. As I love what Brian says, there's always a market somewhere.

People are shifting their trading behavior to the asset that's the most interesting and most excited in the markets they want to trade in. What we saw right now in this quarter, a lot of that was around predictions.

I also want to share with you, this isn't cannibalizing our spot trading. What we've seen is this is all incremental.

When we look at our trading profile, people are still continuing to trade spot, just maybe at a lesser level than they did in past quarters, and they're putting incremental dollars to trade in prediction markets and derivatives. Really, these are additive to our product offering right now.

Right,

which really goes a long way, I think, toward debunking the idea that Bitcoin's the tail that wags the dog, although I think that still seems to inform stock prices, at least in the short term. There's a ton to talk about.

I did want to spend a little time on stablecoins, moving away from transaction. Could you just elaborate for us a bit on your Circle relationship?

To me, it seems very much like a co-opetition situation. Whereas USDC is still primary to your stablecoin efforts, it does seem like both companies are building similar stablecoin movement infrastructure.

Can you talk about perhaps where your efforts overlap with Circle's and where your efforts are distinct?

Brian, don't you want me to start here and then you can add on?

Go for it.

All right. We are proud to be a co-founder of USDC, and we're very committed to growing USDC.

We also want to support other high-quality, regulated stablecoins. You saw that we also partnered with, as an example, with USD.

We also have PYUSD on our platform. We will be supporting our customers in whatever asset they want to trade and whatever asset they want to transact with in crypto.

We think about ourselves asset-agnostic that way. Because of our commercial relationship with Circle, where we have a strong economic interest to grow USDC, we are active in supporting this overall USDC ecosystem.

Coinbase focuses on distribution, the customer relationships, the infrastructure, and really deeply integrating USDC and opportunities to use stablecoins in transaction flows within our products. This means that we are using it as collateral with our derivatives exchange, as an example.

This means that we put USDC on Base to really augment our payments with our Coinbase Developer Platform. As a result, we've seen all-time highs in USDC use on our platform.

We capture about 50% of the overall economics. We hold about 30% of total USDC in circulation as assets on our platform.

We've seen the total assets on our platform grow for five sequential quarters, or it's just been more than that now. It's just been significantly growing on our platform for now many, many quarters.

Where we compete is we're both building stablecoin payment infrastructure, and so we will compete in some areas, but we are both incentivized to grow total USDC market cap and deeply embedded in the overall network of stablecoin usage around the world.

I guess I'd just add that we really enjoy our partnership with Circle. There are many times where we work together on certain efforts.

You're right that we are both building infrastructure. It's going to take a lot of work from lots of companies to go update the financial system, and so I think that that's great what they're doing, and we're going to keep doing our piece of it as well.

Overall, what we want to see is just stablecoins be a larger and larger percentage of global GDP for payments everywhere used in every country of the world. We're going to keep working with them on that.

All right. Let's go to our next guest.

We have Jon Ma from Artemis with us. John, over to you.

Thank you, Andrew, for your questions, too. Hey, Alesia.

Happy early 18th birthday for Bitcoin. That's very exciting.

I hope someone out there is going to have a Halloween Bitcoin costume on that

day.

I'll start looking for that on social.

Yeah. That's my Halloween outfit.

Thanks for the idea, Alesia. I'm really excited to talk about Coinbase Agents and getting your thoughts.

One of our engineers, Crystal, she built onbase.dev, she's a big Base developer, we recently integrated Coinbase MCP trading agents into Artemis, and she said of all the brokerages she worked with, it was the easiest. My question is, what could go right for Coinbase Agents?

Because it's the only MCP that includes X402, prediction markets, equities, and crypto. What could go right from here?

Thanks for using our MCP. We launched this product called Coinbase for Agents a little while back, and it's basically an easy way to connect any third-party agent to your Coinbase account.

We really want to make Coinbase the most AI-enabled financial account out there for trading and payments and borrowing. We've been putting a lot of work into that MCP API, and honestly, it's been really exciting.

The agentic trading volume is growing something like 20% week-over-week right now, which is just shocking. These numbers—

Early days,

early days,

but great growth. Early days.

The numbers in this grand scheme of things are still relatively small compared to our other trading volume, but to me, it's a clear indication of where things are going. I'm just incredibly excited about the TAM for what the agentic economy could be.

You asked what could go right. I think probably like you, we're seeing this trend and thinking, okay, there's going to be more and more agents in the economy getting work done on our behalf.

They are going to have to pay for things, goods and services, to get work done or go shopping for us. In a business context, they're going to have to pay for vendors and services to not get stuck at these paywalls, just like you would give an expense account to an employee or a budget to a certain team.

This is very clear to us that they're going to need their own financial infrastructure. They're going to do it for trading, too.

It's not just payments. What does this mean?

They're going to need to have accounts with good controls and permissions to make sure you're managing their spending and all that. I think that it's hard to imagine a world where there's not more AI agents than humans at some point in this economy.

The agentic economy is going to be massive, and I think it's just one of these opportunities where, frankly, we see the legacy players being a little bit hesitant about this and saying, "I don't know. This is scary.

What if these rogue agents do something unexpected? We're not going to let any of these things touch our accounts."

I kind of feel the opposite. It's an opportunity if we can lean in and build this in a very safe and trusted way, which is what Coinbase is known for, using these frontier technologies, AI and crypto, which by the way, they go really well together.

That's just a huge opportunity for us to capture more and more market share as the most AI-enabled financial account. We're all in on this.

It's what I wake up thinking about a lot these days.

Brian, it gets me really excited because right before the earnings call, I was using the Coinbase MCP to sell some Polkadot, I bought some ServiceNow as stock, I sold down some USDC to buy another stock. It was the only product where everything's all in one place.

Something I'd be curious about is Coinbase is already number one in crypto market share for spot in the US. How do we go from here to number one across all assets, the everything exchange?

Because this does feel very unique, maybe there's a world where every user just uses Coinbase for all their different assets because it's the only place where their agent could access all these different assets in one place.

I think you're right. It gets to what Alesia was saying earlier about diversification.

A lot of these new bets that we made as part of the everything exchange investment over the past year have really started to bear fruit now: prediction markets, derivatives. Because, historically, we've been overweight on spot crypto trading, which was down quarter-over-quarter.

I don't think that this is widely understood yet, and the facts on the ground are actually looking a lot better than it's showing up maybe in the overall numbers, which are more flat-ish. It makes sense to me that if you have an account where you could do all these things in one place—trading, payments, lending—because many of these are synergistic, right?

Like you might want to have a margin account to do more trading, or you might, as a business, you might want to do FX trading as you're receiving payments. We believe that all of these things are going to need to work in one account.

We did this with crypto, we can now do it with AI. I think this could be a massive source of new demand for our products.

That's definitely a very exciting moment. I'll tell you one other fun anecdote, which is, in Coinbase for Agents, we initially, we were going around talking to customers and just saying, "Hey, what would you like to see in it?"

and building some of those features. One of the engineers on our team, they put an endpoint into the Coinbase MCP that is like a /feedback endpoint.

Now all day long, as agents are using it, the agents are actually sending us feedback. Hundreds of messages are just coming into Slack every day that are like different things that they want to see.

A lot of those get turned into pull requests, and now they're live back in production a day later. It's starting to get to that kind of recursive self-improvement-type feeling.

Since that pattern was so successful, we're going to think about putting some of that for our internal APIs as well, just so that because we're using lots of agents internally as well. Every API needs to be agentified, to speak.

Brian, I think folks were wondering, I think Jesse mentioned that you and Jesse were shipping 44 PRs over a day, and maybe you were responding to the agents that were getting feedback about the agent MCP.

That's been part of it, yeah. I've definitely been getting excited to go back and write some code.

It's really the agents writing most of it. Starting my career as an engineer, you get a little rusty in the code the more CEO stuff you do.

But [laughter] yeah, it's definitely a fun moment. I think we're living through this kind of golden age and AI is changing lots of things, but it's now starting to really change financial services.

That's been the biggest opportunity for us. The level of productivity, I think code quality can actually go up as the velocity goes up.

We're seeing that as well on the cyber front, and the number of bugs and incidents and reliability can get better. It's massively upleveling our internal systems.

Then we can go build this infrastructure and provide it for all of our customers. To me, this is the future of financial services.

I feel like we sort of we want to bring frontier technologies like crypto and AI to financial services, and I think we're the best company in the world that's set to do that.

Love that.

All right. Thank you, John, for those questions, and thank you for feedback on the products as well.

We love it when people give us feedback. Next up, we'd like to introduce Lorenzo Valente from ARK, and hand it over to you to ask some questions, Lorenzo.

Hi, Alesia. Hey, Brian.

Thanks for taking these questions. Excited to do this.

Maybe I'll start with just a question on security and custody in general. There's growing concern out there that AI could discover new algos that break cryptography and ECDSA in general.

How does that change the security and custody setup? Are you accelerating the post-quantum roadmap?

Just a question in terms of custody and security in general, and how you guys are thinking about that.

Sure. I think there's really two separate things to look at.

One is the AI, the trends that we're seeing of them coming out with new math proofs and in security things. Then there's the quantum question.

These are actually pretty different. I think that when it comes to ECDSA and this elliptic curve cryptography, I'm actually not too worried about AI creating a risk there.

There's been something like a 40-year track record, actually, of people attempting new algorithms to try to make this easier to break, and they've basically made zero progress. It requires this brute-forcing of a 256-bit number.

It's not one of these problems that I don't think AI is going to be able to chip away at it. Now quantum is a different story.

I think quantum, it requires a new type of computer to be built and actually to do it at scale, not just like a theoretical one with a couple of qubits. I think that's more of a matter of when, not if.

I think eventually a big enough quantum computer will get made that starts to make this stuff a real issue. The quantum one, I think, is the more serious one to look at here.

To get ready for this, we're doing a handful of things. One is we have begun the work to upgrade our custody to be post-quantum.

That's important. Now, of course, we also need the blockchains themselves to be upgraded and to be quantum-resistant.

I know lots of the different blockchains are all working on this. Some of them have published their roadmap.

One thing we've been participating as best we can on the Bitcoin side, there's an advisory council for Bitcoin around post-quantum that had a really good meeting that we attended a few months ago at Stanford with Dan Boneh was leading that along with a number of other folks. That was a really great conversation that just got a lot of the people together in the room.

I know that the community has put out some of these Bitcoin Improvement Proposals like BIP 360, and there's others. My hope is that the Bitcoin community will essentially find a path over the coming couple of quarters to start to coalesce around some of these proposals that are out there.

That one, I think, it's not imminent. I don't think it's going to happen imminently, but I do think it's always good to be proactive and start to get ahead of these things.

I just wanted to add on and share that in 2022, we acquired a team of some of the foremost cryptography experts. This is a space, both on the quantum and on the AI side, that we are monitoring very carefully internally and being really vigilant in investing resources to harden both our own ecosystem as well as work in partnership with the community, as Brian shared.

Perfect. Thanks.

Shifting to the tokenized stocks on Base, I know it's still very early, obviously. Is the base sequencer fee the main revenue driver going forward, or are you looking at other monetization plans?

Just to add to that, we're seeing just a lot of different equities tokenized by several exchanges. How do you see that fragmentation going forward, and how do you think about that?

Great questions, Lorenzo. Yes, sequencer fees are the most direct monetization point for tokenized equities today.

Our main opportunity then is the utility of the assets once they're tokenized. As we kind of expand out and build this network and build liquidity, we can explore different ways to monetize.

Network effect is key. Liquidity is key.

That is the answer to your question on we're seeing a lot of places tokenize equities. We see a lot of stablecoins, but it is easy actually to tokenize something.

I don't mean that the wrong way, but getting the tokenized asset is not the complicated part. Building depth of liquidity, building network effect, that is the hard part.

We're really proud that we're one of the firms with partnership with Circle that has really built that with the USDC ecosystem as an example. We feel like we have the skills, we have the tools to build liquid deep markets around these tokenized equities, and that is what we're doing.

We've already seen $3 billion, for example, tokenized on Base in tokenized equity trading volume since launch of that product for our non-US customers. We're just getting started here, but the key is building network effect.

I do think that what we'll see then over time is things will coalesce and you'll see more and more market share gained by the best pricing and the best network effect and the liquidity offered in these exchanges.

Only thing I'll add to that is that we took the time to really do this in a thoughtful way, which means that these tokenized equities that we put out, they're real-deal securities. You can get the upside from dividends, we're implementing voting rights, things like that.

There are other things out there in the market that are more like synthetics or derivatives that give you exposure to it, but we thought it was important to do it in a way that it's a real security, it can be redeemed for the underlying asset, etc. I think just as the largest custodian in crypto, the most trusted brand in crypto, this is actually something that we're uniquely good at and have a right to win.

I'm excited about tokenized equities.

Thanks.

Thanks, Lorenzo. We're going to go to our last analyst today, and I'd like to introduce Ansem, who is the host of Market Bubble, to ask us a few questions.

Hey, how you guys doing? Thanks for having me on.

Thanks for being here.

This is cool. Actually, I bought my first Bitcoin on Coinbase back in 2017, this is crazy for me.

I know you guys are trying to verticalize a lot of the stack as a financial application, from spot trading, prediction markets, stablecoin interest, and also institutional trading. There're also a lot of other companies that are trying to do the same thing.

How do you guys differentiate in those plans from your competitors?

It's a great question. I do think you're right.

There are more and more people coming together around this everything exchange idea. I think it depends which competitor you're talking about, right?

There's going to be some folks that I think they're not going to lean into this kind of frontier technology, whether it's crypto or AI or perps and prediction markets, and so some of the more traditional players are probably not going to have all of these on one platform with a good, let's say, agentic trading interface. I think if you look at some of the more tech-forward ones, it depends.

I think you have to look at on the surface they might look similar, but Coinbase is trying to do something a little different than I think the others, which is we're not trying to just bring a bunch of people to Wall Street or something. We're trying to make a new decentralized financial system that doesn't need Wall Street, right, and can reach the billions of people that the old system didn't really serve.

I think there's going to be strengths and weaknesses of each of the players, including us. I think that some of the areas where we're going to be a little stronger are on the crypto infrastructure side, because that more is in line with our mission, right?

Things like Base have just a really large developer and on-chain ecosystem around it, we co-founded USDC, we created the X402 protocol for agentic commerce, we have really good decentralized exchange integrations. I'd say one other advantage that Coinbase has is we actually serve not just consumers, but we also serve institutions, we have developer infrastructure that product that we sell.

I think it's a little easier to run a business that has just one customer, but it's actually a lot more powerful if you can build the right platform to serve multiple customer types, which we've been investing in that platform for a number of years now. I think it's really starting to give us leverage and to amortize.

We build something once in an excellent way, we can now launch it across multiple customer segments, and we can actually bring all of these customers to, let's say, a new asset or market on our exchange, and it's retail, it's institutional, it's businesses, it's developers from third parties are now all plugging into that. Those are some of the things we're focused on.

Actually, if I could put in one more real quick, I'd say that still the majority of financial services is running on the traditional financial system. It's probably 90, 95%, depends how you estimate it.

All fintech companies combined are probably, say 5 to 10% of the financial services revenue, which is a massive, massive percentage of GDP. The real opportunity, I think, is for the tech-enabled fintechs to keep growing and capture that other 90 or 95% of the market, and create net new demand from these new categories like agentic finance.

That's really our opportunity, and we're going to do our best to compete, but we're also going to create new markets and go capture share from TradFi.

Awesome. I definitely love the pointers about the decentralized financial system.

I know you guys recently acquired Deribit with your focus more on the institutional investor side of things. How have you seen the growth of that product, the perpetual futures and the options?

How has your plans with that shifted with the recent shift in more of a positive regulatory environment in the US?

We acquired Deribit, which was the largest crypto options trading platform out there, and we've made really good progress now integrating it into our existing products. We've got now this unified, regulated global exchange that crosses everything, perps, options, futures.

We're making Deribit now available to both US and ex-US, I think we're one of the only companies that can unify the global liquidity. Historically, this was fragmented across all the offshore stuff non-US and then in the US had a different world.

We're now unifying much of this. It's been a huge benefit for us acquiring Deribit.

We've said publicly we're going to actually relaunch our advanced trader platform under the Coinbase Pro brand, Coinbase Pro is coming back. You're right, the regulatory front has gotten a lot better as well.

I think we're seeing really tailwinds from that. Not just with the GENIUS Act that became law, but this SEC and CFTC have been very forward-thinking and collaborative between the two agencies to get more of this stuff available in the US, because they want to see the US win, and so do we.

As far as the Coinbase Pro product, actually used to use when it was GDAX back in the day, it's going to be

cool to see

that come

back.

I know you guys are focused a lot on the regulatory stuff in DC, but I feel like you guys haven't done as much on the consumer, retail, marketing side. I know it seems like a lot of the exchanges that did focus heavily on that turned out to be not having the best practices behind the scenes.

I'm curious if you guys have plans to do more marketing along that front to kind of target a different consumer or different customer segment?

I know this perception is out there sometimes that we're almost more focused on DC than on traders or something like that. I think in the wake of Sam Bankman-Fried kind of blowing up and FTX, I remember there was this really kind of critical moment where I felt like I had to go represent the industry there because nobody else was doing it, and in many ways, I feel like that helped the crypto industry.

People forget, it could have gone really poorly under Gensler. The industry

could

have effectively been banned in the US, and we had to sue him and push back and we won that case, and there's another version of history that looks a lot worse. In many ways, I'm glad that we did that.

Now, this doesn't mean it's not a zero-sum game, we can go build products, we can go talk to our customers and help push the regulatory ball forward. I'll still be in DC periodically, but more and more of my focus now is shifting to really just talking to our customers, improving our products.

That's going to be my focus much more in 2027. I think I'd leave it at that.

That's a perfect place to end. We're going to focus on our customers.

Thank you all for joining us for our Q&A for our Q3 2026 earnings. If you haven't already, please go check out our presentation that Brian and I posted to our IR website, where we discuss our quarterly results.

We will see you next quarter. Thank you, all.

Thanks, y'all.