Coinbase Shares May 5th increased 18.33% despite the company’s latest revenue report for the first quarter of 2023, which showed a multimillion-dollar loss despite a rise in bitcoin prices.
As Coinbase reports, the company reported a loss of $79 million, which was much lower than the first quarter of 2022, where it lost about $430 million.
Coinbase Reduces Its Operating Expenses To Increase Its Revenue
The report revealed that Coinbase Global, Inc. had revenue of $772 million during this first quarter. However, operating expenses were $896 million, leading to an operating loss of $128 million, which was far less than the loss of $554 million during the first quarter of 2022.
The reduction in operating expenses is due to the mass layoffs of 950 employees undertaken by the company earlier this year, after reporting a net loss of $557 million during the fourth quarter of 2022.
The January 2023 layoffs were the second largest by the company after they laid off a fifth of their workforce in July 2022 to reduce operating expenses.
Although the massive layoff is an unpleasant decision for those working in this industry, it was the right one for Coinbase, as the company began to show signs of recovery.
Coinbase is facing a legal battle against US regulators
Unlike other exchanges that declared bankruptcy following the collapse of FTX and other large crypto funds, Coinbase has been fighting with regulators in the US due to a lack of regulatory clarity, for which they have had to pay several fines.
As reported by ZyCrypto, legal issues between Coinbase and the SEC continue to escalate, as in late March, Coinbase legal director Paul Grewal said in a statement that the SEC refused to identify who was trading on the platform. C “believed” the assets to be securities, and refused to do so.”
However, on May 3, Grewal informed of That the US court ordered the SEC to respond to Coinbase’s requests within 10 days on how they are applying securities laws to crypto assets, as the regulatory environment in the country is becoming increasingly hostile towards exchanges, which Bittrex Like, has started to move towards other pro. Crypto country.