May 7 (Cointime) - Asheesh Birla, former VP of Product for blockchain startup Ripple, says Coinbase is transitioning from crypto exchange to crypto-enabled banking services.

"Coinbase’s updated mission is building the cryptoeconomy – a more fair, accessible, efficient, and transparent financial system enabled by crypto." Asheesh wrote in a tweet.

According to Asheesh, in Q1 2023, Coinbase's revenue on deposits via interest income, blockchain rewards, and custodial fees made up the majority of its revenues, as shown in the subscription and services revenue chart. Interest on USDC deposits alone generated $199 million, accounting for about 18% of all Coinbase revenue.

In addition, Coinbase's revenues are slowly shifting from consumer to high-margin institutional customers, with institutional trading revenue increasing by 67% from last quarter. The company also benefits from banking-like revenues that are less dependent on the overall crypto market.

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3/Per its Q1 2023 earnings transcript: revenue on deposits via interest income, blockchain rewards, and custodial fees now make up the lion share of Coinbase revenues. Shown as subscription and services revenue below...

4/ Interest on USDC deposits is generating $199M alone or about 18% of all Coinbase revenue

5/ Coinbase revenues are slowly shifting from consumer to high-margin institutional customers. Insitutional trading revenue increased 67% from last quarter.

6/ Coinbase also benefits from banking-like revenues that are less dependent on the overall crypto market

7/ With trust in traditional banking eroding, is the timing right for institutions and consumers to turn to alternatives?