Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 25, 2024 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-40289 | |
Entry Registrant Name | Coinbase Global, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 46-4707224 | |
Title of 12(b) Security | Class A common stock, $0.00001 par value per share | |
Trading Symbol | COIN | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001679788 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Class A common stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 199,758,519 | |
Class B common stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 45,810,422 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 6,711,400 | $ 5,139,351 |
Restricted cash | 33,499 | 22,992 |
Customer custodial funds | 5,201,906 | 4,570,845 |
Safeguarding customer crypto assets | 329,506,477 | 192,583,060 |
USDC | 860,669 | 576,028 |
Loan receivables | 529,143 | 193,425 |
Crypto assets held as collateral | 106,610 | 0 |
Crypto assets held as collateral | 0 | |
Crypto assets borrowed | 231,348 | 45,212 |
Accounts receivable, net | 280,357 | 168,290 |
Other current assets | 379,537 | 286,643 |
Total current assets | 343,840,946 | 203,585,846 |
Crypto assets held for investment | 1,522,328 | |
Crypto assets held for investment | 330,610 | |
Deferred tax assets | 879,671 | 1,272,233 |
Goodwill | 1,139,670 | 1,139,670 |
Other non-current assets | 653,862 | 654,594 |
Total assets | 348,036,477 | 206,982,953 |
Current liabilities: | ||
Customer custodial cash liabilities | 5,201,906 | 4,570,845 |
Safeguarding customer crypto liabilities | 329,506,477 | 192,583,060 |
Crypto asset borrowings | 272,805 | |
Crypto asset borrowings | 62,980 | |
Obligation to return collateral | 315,090 | 1,063 |
Accrued expenses and other current liabilities | 438,321 | 496,183 |
Total current liabilities | 335,734,599 | 197,714,131 |
Long-term debt | 4,225,014 | 2,979,957 |
Other non-current liabilities | 5,870 | 7,216 |
Total liabilities | 339,965,483 | 200,701,304 |
Commitments and contingencies (Note 19) | ||
Preferred stock, $0.00001 par value; 500,000 shares authorized and zero shares issued and outstanding at each of March 31, 2024 and December 31, 2023 | 0 | 0 |
Stockholders’ equity: | ||
Additional paid-in capital | 4,550,408 | 4,491,571 |
Accumulated other comprehensive loss | (37,496) | (30,270) |
Retained earnings | 3,558,080 | 1,820,346 |
Total stockholders’ equity | 8,070,994 | 6,281,649 |
Total liabilities and stockholders’ equity | 348,036,477 | 206,982,953 |
Class A common stock | ||
Stockholders’ equity: | ||
Common stock | 2 | 2 |
Class B common stock | ||
Stockholders’ equity: | ||
Common stock | $ 0 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
Convertible preferred stock par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Convertible preferred shares authorized (in shares) | 500,000,000 | 500,000,000 |
Convertible preferred shares issued (in shares) | 0 | 0 |
Convertible preferred shares outstanding (in shares) | 0 | 0 |
Class A common stock | ||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 10,000,000,000 | 10,000,000,000 |
Common stock, issued (in shares) | 199,449,000 | 195,192,000 |
Common stock, outstanding (in shares) | 199,449,000 | 195,192,000 |
Class B common stock | ||
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, issued (in shares) | 45,922,000 | 46,856,000 |
Common stock, outstanding (in shares) | 45,922,000 | 46,856,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Revenue: | ||
Revenue | $ 1,637,570,000 | $ 772,529,000 |
Operating expenses: | ||
Transaction expense | 217,407,000 | 96,369,000 |
Technology and development | 357,863,000 | 358,031,000 |
Sales and marketing | 98,585,000 | 63,976,000 |
General and administrative | 287,236,000 | 248,761,000 |
Gains on crypto assets held for operations, net | (86,358,000) | 0 |
Crypto asset impairment, net | 0 | 17,962,000 |
Restructuring | 0 | 144,489,000 |
Other operating expense (income), net | 2,376,000 | (33,184,000) |
Total operating expenses | 877,109,000 | 896,404,000 |
Operating income (loss) | 760,461,000 | (123,875,000) |
Interest expense | 19,071,000 | 21,536,000 |
Gains on crypto assets held for investment, net | (650,429,000) | 0 |
Other (income) expense, net | (45,605,000) | 20,265,000 |
Income (loss) before income taxes | 1,437,424,000 | (165,676,000) |
Provision for (benefit from) income taxes | 261,179,000 | (86,780,000) |
Net income (loss) | 1,176,245,000 | (78,896,000) |
Net income (loss) attributable to common stockholders: | ||
Basic | 1,175,479,000 | (78,896,000) |
Diluted | $ 1,178,079,000 | $ (78,896,000) |
Net income (loss) per share attributable to common stockholders: | ||
Basic (in dollars per share) | $ 4.84 | $ (0.34) |
Diluted (in dollars per share) | $ 4.40 | $ (0.34) |
Weighted-average shares of common stock used to compute net income (loss) per share attributable to common stockholders: | ||
Basic (in shares) | 242,793 | 231,489 |
Diluted (in shares) | 267,945 | 231,489 |
Net revenue | ||
Revenue: | ||
Revenue | $ 1,587,677,000 | $ 736,398,000 |
Other revenue | ||
Revenue: | ||
Revenue | $ 49,893,000 | $ 36,131,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ 1,176,245 | $ (78,896) |
Other comprehensive income (loss): | ||
Translation adjustment | (6,898) | 12,513 |
Income tax effect | 328 | 2,316 |
Translation adjustment, net of tax | (7,226) | 10,197 |
Comprehensive income (loss) | $ 1,169,019 | $ (68,699) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative adjustment | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive (Loss) Income | Retained Earnings | Retained Earnings Cumulative adjustment |
Beginning balance (in shares) at Dec. 31, 2022 | 230,866 | ||||||
Beginning balance at Dec. 31, 2022 | $ 5,454,557 | $ 2 | $ 3,767,686 | $ (38,606) | $ 1,725,475 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of equity instruments as consideration for business combination (in shares) | 961 | ||||||
Issuance of equity instruments as consideration for business combinations | 44,995 | 44,995 | |||||
Issuance of common stock upon settlement of stock awards, net of shares withheld (in shares) | 1,955 | ||||||
Issuance of common stock upon settlement of stock awards, net of shares withheld | (62,497) | (62,497) | |||||
Issuance of common stock upon exercise of stock options, net of repurchases (in shares) | 713 | ||||||
Issuance of common stock upon exercise of stock options, net of repurchases | 9,566 | 9,566 | |||||
Stock-based compensation expense | 212,982 | 212,982 | |||||
Stock-based compensation expense recognized in relation to restructuring | 84,042 | 84,042 | |||||
Comprehensive income (loss) | 10,197 | 10,197 | |||||
Net income (loss) | (78,896) | (78,896) | |||||
Ending balance (in shares) at Mar. 31, 2023 | 234,495 | ||||||
Ending balance at Mar. 31, 2023 | 5,674,946 | $ 2 | 4,056,774 | (28,409) | 1,646,579 | ||
Beginning balance (in shares) at Dec. 31, 2022 | 230,866 | ||||||
Beginning balance at Dec. 31, 2022 | $ 5,454,557 | $ 2 | 3,767,686 | (38,606) | 1,725,475 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Accounting standards update | Accounting Standards Update 2023-08 [Member] | ||||||
Ending balance (in shares) at Dec. 31, 2023 | 242,048 | ||||||
Ending balance at Dec. 31, 2023 | $ 6,281,649 | $ 561,489 | $ 2 | 4,491,571 | (30,270) | 1,820,346 | $ 561,489 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock upon settlement of stock awards, net of shares withheld (in shares) | 999 | ||||||
Issuance of common stock upon settlement of stock awards, net of shares withheld | $ (117,225) | (117,225) | |||||
Issuance of common stock upon exercise of stock options, net of repurchases (in shares) | 2,338 | 2,324 | |||||
Issuance of common stock upon exercise of stock options, net of repurchases | $ 44,603 | 44,603 | |||||
Stock-based compensation expense | 235,569 | 235,569 | |||||
Purchase of capped calls | (104,110) | (104,110) | |||||
Comprehensive income (loss) | (7,226) | (7,226) | |||||
Net income (loss) | 1,176,245 | 1,176,245 | |||||
Ending balance (in shares) at Mar. 31, 2024 | 245,371 | ||||||
Ending balance at Mar. 31, 2024 | $ 8,070,994 | $ 2 | $ 4,550,408 | $ (37,496) | $ 3,558,080 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Cash flows from operating activities | ||
Net income (loss) | $ 1,176,245 | $ (78,896) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 29,327 | 41,208 |
Stock-based compensation expense | 224,504 | 198,860 |
Restructuring stock-based compensation expense | 0 | 84,042 |
Deferred income taxes | 214,361 | (84,169) |
Unrealized (gain) loss on foreign exchange | (992) | 8,428 |
Non-cash lease expense | 2,793 | 12,215 |
Fair value gains on crypto assets borrowed and borrowings | (2,944) | (3,199) |
Gains on crypto assets held as investments and operations | (736,787) | (84,685) |
Realized loss on crypto futures contract | 0 | 43,339 |
Crypto asset impairment expense (prior to ASU 2023-08) | 0 | 28,935 |
Other operating activities, net | (21,020) | (18,327) |
Net changes in operating assets and liabilities | (474,002) | 315,327 |
Net cash provided by operating activities | 411,485 | 463,078 |
Cash flows from investing activities | ||
Fiat loans originated | (416,405) | (65,611) |
Proceeds from repayment of fiat loans | 254,600 | 31,779 |
Purchase of crypto assets held for investment | (135) | (53,223) |
Sale of crypto assets held for investment | 51,659 | 110,776 |
Settlement of crypto futures contract | 0 | (43,339) |
Other investing activities, net | (15,400) | (6,462) |
Net cash used in investing activities | (125,681) | (26,080) |
Cash flows from financing activities | ||
Issuance of common stock upon exercise of stock options, net of repurchases | 44,216 | 8,873 |
Taxes paid related to net share settlement of equity awards | (117,225) | (62,497) |
Proceeds received under the ESPP | 5,460 | 4,562 |
Customer custodial cash liabilities | 645,938 | 528,959 |
Issuance of convertible senior notes, net | 1,246,025 | 0 |
Purchase of capped calls | (104,110) | 0 |
Fiat received as collateral | 340,296 | 3,117 |
Fiat received as collateral returned | (132,879) | (2,403) |
Other financing activities | 0 | (20,482) |
Net cash provided by financing activities | 1,927,721 | 460,129 |
Net increase in cash, cash equivalents, and restricted cash | 2,213,525 | 897,127 |
Effect of exchange rates on cash, cash equivalents, and restricted cash | (21,186) | 11,377 |
Cash, cash equivalents, and restricted cash, beginning of period | 9,555,448 | 9,429,646 |
Cash, cash equivalents, and restricted cash, end of period | 11,747,787 | 10,338,150 |
Supplemental disclosure of cash flow information | ||
Cash paid during the period for interest | 0 | 74 |
Cash paid during the period for income taxes | 5,528 | 5,322 |
Operating cash outflows for amounts included in the measurement of operating lease liabilities | $ 3,140 | $ 4,668 |
NATURE OF OPERATIONS
NATURE OF OPERATIONS | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS | NATURE OF OPERATIONS Coinbase, Inc. was founded in 2012. In April 2014, in connection with a corporate reorganization, Coinbase, Inc. became a wholly-owned subsidiary of Coinbase Global, Inc. (together with its consolidated subsidiaries, the “Company”). On April 14, 2021, the Company completed the direct listing of its Class A common stock on the Nasdaq Global Select Market (the “Direct Listing”). The Company provides a trusted platform that serves as a compliant gateway to the onchain economy and enables customers to engage in a wide variety of activities, including discovering, trading, staking, storing, spending, earning, and using their crypto assets in both proprietary and third-party product experiences enabled by access to decentralized applications. The Company offers (i) consumers their primary financial account for the cryptoeconomy, (ii) institutions a full-service prime brokerage platform with access to deep pools of liquidity across the crypto marketplace, and (iii) developers a suite of products granting access to the Company’s ecosystem. The Company is a remote-first company. Accordingly, the Company does not maintain a headquarters or principal executive offices. Substantially all of the Company’s executive team meetings are held virtually, with meetings occasionally held in-person at locations that are either not in the Company’s offices or in various of the Company’s offices distributed around the world. The Company holds all of its stockholder meetings virtually. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of presentation and preparation The accompanying Condensed Consolidated Financial Statements include the accounts of the Company and its subsidiaries – entities in which the Company holds, directly or indirectly, more than 50% of the voting rights, or where it exercises control. The Condensed Consolidated Financial Statements are unaudited but have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) on the same basis as the audited Consolidated Financial Statements, and in management’s opinion, reflect all adjustments, consisting only of normal, recurring adjustments, that are necessary for the fair presentation of the Company’s Financial Statements. Preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions in the Condensed Consolidated Financial Statements and notes thereto. Certain prior period amounts in the Condensed Consolidated Financial Statements have been reclassified to conform to the current period’s presentation. The unaudited Condensed Consolidated Results of Operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year or any other period and should be read in conjunction with the audited Consolidated Financial Statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on February 15, 2024 (the “Annual Report”). There were no changes to the Company’s most significant estimates and assumptions, significant accounting policies, or recent accounting pronouncements that were disclosed in Note 2. Summary of Significant Accounting Policies to the audited Consolidated Financial Statements included in the Annual Report, other than as discussed below. Concentration of credit risk The Company’s cash and cash equivalents, restricted cash, customer custodial funds, accounts receivable, loan receivables and deposits are potentially subject to concentration of credit risk. Cash and cash equivalents, restricted cash, and customer custodial funds are primarily placed with financial institutions which are of high credit quality. The Company invests cash and cash equivalents and customer custodial funds primarily in highly liquid, highly rated instruments which are uninsured. The Company may also have corporate deposit balances with financial institutions which exceed the Federal Deposit Insurance Corporation insurance limit of $250,000. The Company has not experienced losses on these accounts and does not believe it is exposed to any significant credit risk with respect to these accounts. The Company also holds cash, restricted cash, and crypto assets at crypto asset trading venues, payment processors, and clearing brokers, and performs a regular assessment of these venues as part of its risk management process. As of March 31, 2024, the Company held $203.3 million at these venues, including $124.8 million in unrestricted cash, $63.6 million in crypto assets, and $14.9 million in restricted deposits. As of December 31, 2023, the Company held $93.5 million at these venues, including $88.8 million in unrestricted cash, an immaterial amount of crypto assets, and $4.7 million in restricted deposits. The issuer of USDC reported that, as of March 31, 2024, underlying reserves were held in cash, short-duration U.S. Treasuries, and overnight U.S. Treasury repurchase agreements within segregated accounts for the benefit of USDC holders. As of March 31, 2024 and December 31, 2023, the Company had five and three counterparties and four and three counterparties, respectively, who accounted for more than 10% of the Company’s recorded loan receivables and unrecorded loans receivable, respectively. As of both March 31, 2024 and December 31, 2023, the Company had two counterparties who accounted for more than 10% of the Company’s Accounts receivable, net. See Note 6. Collateralized Arrangements and Financing for details on collateralization of loan receivables. During the three months ended March 31, 2024 and 2023, one counterparty accounted for more than 10% of total revenue in each period. Crypto assets held The Company holds crypto assets for investment and operating purposes, as well as borrowed crypto assets and crypto assets held as collateral. Effective January 1, 2024, the Company adopted ASU No. 2023-08, Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”) using a modified retrospective approach. Upon adoption, the Company recognized a fair value adjustment on crypto assets held of $739.5 million and established a deferred tax liability of $177.9 million, for a net cumulative-effect adjustment of $561.5 million increasing retained earnings. As a result of the adoption of ASU 2023-08, the Company introduced four new categories of crypto assets held in the Condensed Consolidated Balance Sheets based on their nature. This updated presentation aligns with the requirements of ASU 2023-08 and describes the purpose of the various types of crypto assets held by the Company. Crypto assets held for investment Crypto assets held for investment are primarily held as long-term holdings. The Company does not engage in regular trading of these crypto assets. The Company may loan crypto assets held for investment through Prime Financing. See Note 6. Collateralized Arrangements and Financing for additional details on Prime Financing. Crypto assets held for investment are initially recorded at cost and are subsequently remeasured at fair value on a specific identification basis at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets held for investment are recognized within Gains on crypto assets held for investment, net in the Condensed Consolidated Statements of Operations. Cash flows from crypto asset investment purchases and sales are recorded in Net cash used in investing activities in the Condensed Consolidated Statements of Cash Flows. Crypto assets held for operations The Company may receive crypto assets as a form of payment for transaction revenue, blockchain rewards, custodial fee revenue, and other subscriptions and services revenue which are recorded in Crypto assets held for operations when received. Crypto assets received as a form of payment are converted to cash nearly immediately or are used timely to fulfill corporate expenses. Crypto assets held for operations are initially recorded at the transaction price of the crypto assets at contract inception and are subsequently remeasured at fair value on a first in first out basis at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets held for operations are recorded in Gains on crypto assets held for operations, net in the Condensed Consolidated Statements of Operations. Cash flows from crypto assets held for operations are recorded as Net changes in operating assets and liabilities in the Condensed Consolidated Statements of Cash Flows. Crypto assets held for operations are recorded in Other current assets in the Condensed Consolidated Balance Sheets. Crypto assets borrowed Crypto assets borrowed represent crypto assets borrowed from third parties to facilitate Prime Financing. Prior to the adoption of ASU 2023-08, crypto assets borrowed were designated as fair value hedges, and accounted for as hybrid instruments, with a liability host contract that contained an embedded derivative based on the changes in fair value of the underlying crypto asset. Contemporaneously with the adoption of ASU 2023-08, the Company dedesignated $62.9 million of crypto assets borrowed that previously qualified as fair value hedges against the corresponding crypto asset borrowing. There was a net zero impact of the cumulative fair value hedge basis adjustments that were reversed and recorded in Transaction expense. As of December 31, 2023, the cumulative amount of fair value hedging adjustment was $3.9 million. Post dedesignation and ASU 2023-08 adoption, crypto assets borrowed by the Company, that have not been loaned out, are recorded in Crypto assets borrowed in the Condensed Consolidated Balance Sheets. Crypto assets borrowed are initially recorded at cost and are subsequently remeasured at fair value using the average costing method at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets borrowed are recorded within Transaction expenses. See Note 6. Collateralized Arrangements and Financing for further details on Crypto assets borrowed and Note 21. Supplemental Disclosures of Cash Flow Information for details on cash flows from crypto assets borrowed included in the supplemental schedule of non-cash investing and financing activities. Crypto assets held as collateral For loans receivable, the Company requires borrowers to pledge collateral on loans offered under Prime Financing. Crypto assets held as collateral are initially recorded at cost if the Company has the right to sell, pledge or rehypothecate and are subsequently remeasured at fair value using the specific identification method at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets held as collateral are recorded in Transaction expenses. See Note 6. Collateralized Arrangements and Financing for additional details on crypto assets borrowed and Note 21. Supplemental Disclosures of Cash Flow Information for details on cash flows from Crypto assets held as collateral included in the supplemental schedule of non-cash investing and financing activities. The following table presents the effects of the changes in presentation in the Condensed Consolidated Balance Sheets (in thousands): December 31, 2023 Previously Reported Adjustment As Adjusted Crypto assets held (1) $ 449,925 $ (449,925) $ — Crypto assets held for investment — 330,610 330,610 Crypto assets held for operations — 74,103 74,103 Crypto assets borrowed — 45,212 45,212 $ 449,925 $ — $ 449,925 _________________ (1) No crypto assets held as collateral met the recognition criteria as of December 31, 2023. Recent accounting pronouncements There have been no new developments to recently issued accounting standards, including the expected dates of adoption and estimated effects on the Company’s Consolidated Financial Statements and footnote disclosures, from those disclosed in the Annual Report. |
RESTRUCTURING
RESTRUCTURING | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | RESTRUCTURING In January 2023, the Company announced and completed a restructuring impacting approximately 21% of the Company’s headcount as of December 31, 2022. The restructuring was intended to manage the Company’s operating expenses in response to the ongoing market conditions impacting the cryptoeconomy and ongoing business prioritization efforts. As a result, the Company recorded restructuring charges of $144.5 million, which included $84.0 million in stock-based compensation, $57.7 million in separation pay, and an immaterial amount of other personnel costs. There were no restructuring charges during the three months ended March 31, 2024. |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS | ACQUISITIONS Information on acquisitions completed during the periods presented is set forth below. The impact of these acquisitions was not considered material to the Condensed Consolidated Financial Statements for the periods presented, and pro forma financial information has not been provided. One River Digital Asset Management, LLC On March 3, 2023 , the Company completed the acquisition of One River Digital Asset Management, LLC (“ORDAM”) by acquiring all issued and outstanding membership units of ORDAM. ORDAM is an institutional digital asset manager which is registered as an investment adviser with the SEC. The Company believes the acquisition aligns with the Company’s long-term strategy to unlock further opportunities for institutions to participate in the cryptoeconomy. Prior to the acquisition, the Company held a minority ownership stake in ORDAM, which was accounted for as a cost method investment. In accordance with ASC Topic 805, Business Combinations , the acquisition was accounted for as a business combination achieved in stages under the acquisition method. Accordingly, the cost method investment was remeasured to fair value as of the acquisition date. As the fair value of the cost method investment was equal to its carrying value, no gain or loss on remeasurement was recorded on the acquisition date. The purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date with the excess recorded as goodwill. The goodwill balance was primarily attributed to the assembled workforce, market presence, synergies, and time-to-market advantages. The Company finalized the fair value valuation analysis of assets acquired and liabilities assumed and as a result no measurement period adjustments were recorded. The total consideration transferred in the acquisition was $96.8 million, consisting of the following (in thousands): Cash $ 30,830 Cash payable 1,005 Previously-held interest on acquisition date 20,000 Class A common stock of the Company 44,995 Total purchase consideration $ 96,830 Included in the purchase consideration was $6.0 million in cash and 119,991 shares of the Company’s Class A common stock that are subject to an indemnity holdback. The cash and shares subject to the indemnity holdback will be released 18 months after the closing date of the transaction. The results of operations and the provisional fair values of the assets acquired and liabilities assumed have been recorded in the Condensed Consolidated Financial Statements as of the date of acquisition. The following table summarizes the fair values of assets acquired and liabilities assumed as of the date of acquisition (in thousands): Goodwill $ 65,764 Intangible assets, net 21,100 Other assets and liabilities, net 9,966 Net assets acquired $ 96,830 The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands, except for years data): Fair Value Useful Life at Acquisition (in years) Licenses $ 1,100 Indefinite Customer relationships 17,100 6 In-process research and development (“IPR&D”) 2,900 N/A Customer relationships are amortized on a straight-line basis over their respective useful lives to general and administrative expense. The licenses have an indefinite useful life and will not be amortized. Management applied significant judgment in determining the fair value of intangible assets, which involved the use of estimates and assumptions with respect to forecasted revenues and expenses, and costs to recreate the IPR&D and obtain the licenses. |
REVENUE
REVENUE | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE The following table presents revenue of the Company disaggregated by revenue source (in thousands): Three Months Ended March 31, 2024 2023 Net revenue Transaction revenue Consumer, net (1) $ 935,212 $ 329,152 Institutional, net 85,392 22,311 Other transaction revenue (1) 56,137 23,250 Total transaction revenue 1,076,741 374,713 Subscription and services revenue Stablecoin revenue 197,317 198,898 Blockchain rewards 150,929 73,749 Interest and finance fee income (2) 66,663 43,313 Custodial fee revenue 32,341 17,043 Other subscription and services revenue (2) 63,686 28,682 Total subscription and services revenue 510,936 361,685 Total net revenue 1,587,677 736,398 Other revenue Corporate interest and other income 49,893 36,131 Total other revenue 49,893 36,131 Total revenue $ 1,637,570 $ 772,529 __________________ (1) During the first quarter of 2024, the Company reclassified Base and payment-related revenue from consumer, net to other transaction revenue. Prior period amounts have been reclassified to conform to current period presentation. (2) During the first quarter of 2024, the Company reclassified Prime Financing fees earned from other subscription and services revenue to interest income, and renamed interest income to interest and finance fee income. Prior period amounts have been reclassified to conform to current period presentation. Revenue by geographic location In the table below are the revenues disaggregated by geography, based on domicile of the customers, as applicable (in thousands): Three Months Ended March 31, 2024 2023 United States $ 1,353,450 $ 686,769 International (1) 284,120 85,760 Total revenue $ 1,637,570 $ 772,529 __________________ (1) No other individual country accounted for more than 10% of total revenue. |
COLLATERALIZED ARRANGEMENTS AND
COLLATERALIZED ARRANGEMENTS AND FINANCING | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
COLLATERALIZED ARRANGEMENTS AND FINANCING | COLLATERALIZED ARRANGEMENTS AND FINANCING Loans and related collateral The Company may lend crypto assets borrowed, crypto assets held for investment, crypto assets held for operations, corporate cash, and corporate USDC to eligible institutional customers through Prime Financing. Prime Financing lending arrangements may have open ended or fixed terms, with the exception of trade finance, where the Company enables customers to instantly invest in crypto assets without pre-funding their trade, which transactions are typically settled in one to three days. Crypto asset and fiat loans are recorded in Loan receivables in the Condensed Consolidated Balance Sheets. USDC loaned to customers does not meet derecognition criteria under ASC 860, Transfers and Servicing (“ASC 860”) as the borrower has an obligation to return the same financial assets (USDC) back to the Company in order to release the collateral pledged for the loan. This constitutes a form of continuing involvement with the USDC transferred and therefore the Company maintains effective control over the USDC. USDC loaned remains recorded in corporate USDC in the Condensed Consolidated Balance Sheets. The following table summarizes the Company’s Prime Financing lending arrangements (in thousands): March 31, December 31, 2024 2023 Loan receivables Trade finance receivables $ 122,817 $ — Fiat loan receivables 210,185 171,196 Crypto asset loan receivables 196,141 22,229 Total loan receivables $ 529,143 $ 193,425 Customer loans not meeting recognition criteria USDC $ 268,345 $ 205,645 Prime Financing loans are fully collateralized by a customer’s pledged crypto assets, USDC, or fiat, with collateral requirements ranging from 100% to 400% of the fair value of the loan. The Company adheres to strict internal risk management and liquidation protocols for loan counterparty defaults, including restricting trading and withdrawals and liquidating assets in borrowers’ accounts as contractually permitted. If the value of the borrower’s eligible collateral falls below the required collateral requirement, the customer is obligated to deposit additional collateral up to the required collateral level. The Company continuously and systematically monitors the fair value of the related collateral assets pledged compared to the fair value of the related loan receivable, and requires additional collateral pursuant to the contractual terms of the loan agreements. Due to the collateral requirements the Company applies to its loans, the collateral maintenance process, and collateral being held on its own platform, the Company’s credit exposure is significantly limited and no allowance, write-offs or recoveries were recorded against loans receivable for the periods presented. The Company would recognize credit losses on these loans if there were a collateral shortfall and it is not reasonably expected that the borrower will replenish such a shortfall. If the Company receives fiat collateral into a Coinbase controlled collateral wallet, the Company records the collateral in Cash and cash equivalents and a corresponding liability in Obligation to return collateral in the Condensed Consolidated Balance Sheets. If the Company receives USDC or crypto assets as collateral with contractual rights to sell, pledge, or rehypothecate the collateral, the Company records the collateral in corporate USDC or Crypto assets held as collateral, respectively, and a corresponding liability in Obligation to return collateral in the Condensed Consolidated Balance Sheets. Obligation to return collateral, if a crypto asset, is accounted for as a hybrid instrument, with a liability host contract that contains an embedded derivative based on the changes in the fair value of the underlying crypto asset. The remeasurement of the crypto assets held as collateral and the obligation to return collateral are recorded net in Transaction expense. If the Company does not obtain control or have the right to sell, pledge, or rehypothecate customer collateral, the collateral is recorded in Safeguarding customer crypto assets and Safeguarding customer crypto liabilities if the collateral is USDC or crypto assets and Customer custodial funds and Customer custodial cash obligations if the collateral is fiat, as the collateral is required to be held on the Company’s platform. The Company’s Crypto assets held as collateral and Obligation to return collateral consisted of the following (in thousands, except units): March 31, 2024 December 31, 2023 Units Fair Value Units Fair Value Crypto assets held as collateral Bitcoin (1) 1,495 $ 106,610 — $ — Total held as collateral $ 106,610 $ — Obligation to return collateral Fiat N/A $ 208,480 N/A $ 1,063 Bitcoin 1,495 106,610 — — Total obligation to return collateral $ 315,090 $ 1,063 Customer collateral pledged, not recognized nm $ 1,578,643 nm $ 712,644 __________________ nm - not meaningful (1) The cost basis of bitcoin held as collateral as of March 31, 2024 was $75.4 million. The following table summarizes the reconciliation of Crypto assets held as collateral for the three months ended March 31, 2024 (in thousands): January 1, 2024 Cumulative Adjustment Collateral Received Collateral Returned Gains (1) Losses (1) March 31, 2024 Crypto assets held as collateral $ — $ — $ 90,798 $ (15,374) $ 31,186 $ — $ 106,610 __________________ (1) No cumulative realized gains or losses occurred during the period. Borrowings and related collateral To facilitate Prime Financing, the Company may borrow crypto assets from third parties and records the associated liability in Crypto asset borrowings in the Condensed Consolidated Balance Sheets. Crypto asset borrowings that have not been loaned out are recorded in Crypto assets borrowed. Crypto asset borrowings are accounted for as hybrid instruments, with a liability host contract that contains an embedded derivative based on the changes in the fair value of the underlying crypto asset. See Note 13. Derivatives for additional information. As of March 31, 2024 and December 31, 2023, the weighted average annual fees on these borrowings were 2.3% and 2.0%, respectively. See Note 13. Derivatives , for additional details regarding Crypto asset borrowings. The following table summarizes the units, cost basis, and fair value of crypto assets borrowed (in thousands, except units) and the associated crypto asset borrowings: March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value Crypto assets borrowed Bitcoin 2,688 $ 112,099 $ 191,573 $ 36,368 Ethereum 1,122 2,214 4,093 3,720 Solana 55,575 5,198 11,247 3,516 Other crypto assets (1) nm 14,247 24,435 1,608 Total borrowed $ 133,758 $ 231,348 $ 45,212 Crypto asset borrowings Bitcoin 3,040 $ 128,417 $ 216,703 $ 50,679 Ethereum 5,601 10,655 20,420 7,059 Solana 55,575 5,198 11,247 3,513 Other crypto assets (1) nm 14,248 24,435 1,729 Total borrowings $ 158,518 $ 272,805 $ 62,980 __________________ nm - not meaningful (1) Includes various other crypto assets balances, none of which individually represented more than 5% of total crypto assets borrowed and crypto asset borrowings. The following table summarizes the reconciliation of Crypto assets borrowed for the three months ended March 31, 2024 (in thousands): Additions Dispositions January 1, 2024 Crypto Borrowings Originated Crypto Loans Repaid Crypto Borrowings Repaid Crypto Loans Originated Gains (1) Losses (1) March 31, 2024 Crypto assets borrowed $ 45,212 $ 191,436 $ 285,254 $ (77,451) $ (301,168) $ 88,352 $ (287) $ 231,348 __________________ (1) No cumulative realized gains or losses occurred during the period. Under the terms of the Company’s borrowing arrangements, the Company may be required to maintain a collateral to loan ratio and pledge fiat, USDC, or crypto assets for crypto asset borrowings. If the lender has the right to use the collateral, or if the collateral is fiat, the Company records the collateral pledged as a right to receive the collateral within Other current assets in the Condensed Consolidated Balance Sheets. USDC pledged as collateral to lenders, where the lender does not have the right to sell, pledge or rehypothecate, is not recorded as assets pledged as collateral as the pledged USDC does not meet the derecognition criteria under ASC 860. This collateral continues to be recorded in USDC in the Condensed Consolidated Balance Sheets. The Company’s corporate assets pledged as collateral against crypto borrowings consisted of the following (in thousands, except units): March 31, 2024 December 31, 2023 Units Fair Value Units Fair Value Assets pledged as collateral USDC 73,096,425 $ 73,096 51,879,705 $ 51,880 Fiat N/A — N/A 1,191 Total pledged as collateral $ 73,096 $ 53,071 Assets pledged as collateral not meeting derecognition criteria USDC 221,827,262 $ 221,827 29,577,339 $ 29,577 |
ACCOUNTS RECEIVABLE, NET
ACCOUNTS RECEIVABLE, NET | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
ACCOUNTS RECEIVABLE, NET | ACCOUNTS RECEIVABLE, NET Accounts receivable, net of allowance consisted of the following (in thousands): March 31, December 31, 2024 2023 Stablecoin revenue receivable $ 75,499 $ 57,885 Customer fee revenue receivable (1) 32,078 23,603 In-transit customer receivables 88,472 42,562 Other accounts receivable (1) 118,263 66,799 Less: allowance for doubtful accounts receivable (33,955) (22,559) Total accounts receivable, net $ 280,357 $ 168,290 __________________ (1) Includes accounts receivable denominated in crypto assets. See Note 13. Derivatives |
CRYPTO ASSETS HELD FOR INVESTME
CRYPTO ASSETS HELD FOR INVESTMENT | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
CRYPTO ASSETS HELD FOR INVESTMENT | CRYPTO ASSETS HELD FOR INVESTMENT The following table summarizes the units, cost basis, and fair value of Crypto assets held for investment (in thousands, except units): March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value (1) Bitcoin 9,183 $ 270,438 $ 654,655 $ 126,614 Ethereum 96,086 190,447 350,267 129,131 Other crypto assets (2) nm 213,922 517,406 74,865 Total held for investment $ 674,807 $ 1,522,328 $ 330,610 __________________ nm - not meaningful (1) Recorded at impaired cost as of December 31, 2023. (2) Includes various other crypto assets balances, none of which individually represented more than 5% of total Crypto assets held for investment. The following table summarizes the reconciliation of Crypto assets held for investment for the three months ended March 31, 2024 (in thousands): Transfers January 1, 2024 Cumulative Adjustment (1) Additions (2) Sales From Operating Crypto Loans Originated Crypto Loans Repaid Gains (3) Losses (3) March 31, 2024 Crypto assets held for investment $ 330,610 $ 717,373 $ 3,530 $ (59,726) $ 1,972 $ (123,081) $ 1,221 $ 655,688 $ (5,259) $ 1,522,328 __________________ (1) Fair value adjustment on Crypto assets held for investment upon the Company’s adoption of ASU 2023-08. (2) Additions represent purchases of and staking rewards earned on Crypto assets held for investment. (3) Includes $17.0 million of cumulative realized gains from sales that occurred during the period and no cumulative realized losses. The Company has $264.3 million of assets subject to selling restrictions recorded in Crypto assets held for investment. The selling restrictions are time-based and lift between 2024 and 2029. Restrictions do not consist of any other obligations. |
CUSTOMER ASSETS AND LIABILITIES
CUSTOMER ASSETS AND LIABILITIES | 3 Months Ended |
Mar. 31, 2024 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
CUSTOMER ASSETS AND LIABILITIES | CUSTOMER ASSETS AND LIABILITIES The following table presents customers’ cash and safeguarded crypto positions (in thousands): March 31, December 31, 2024 2023 Customer custodial funds $ 5,201,906 $ 4,570,845 Safeguarding customer crypto assets 329,506,477 192,583,060 Total customer assets $ 334,708,383 $ 197,153,905 Customer custodial cash liabilities $ 5,201,906 $ 4,570,845 Safeguarding customer crypto liabilities 329,506,477 192,583,060 Total customer liabilities $ 334,708,383 $ 197,153,905 During the three months ended March 31, 2024 and 2023, no losses were incurred in connection with safeguarding customer crypto assets. The following table sets forth the fair values of Safeguarding customer crypto assets as shown on the Condensed Consolidated Balance Sheets (in thousands, except percentages): March 31, 2024 December 31, 2023 Fair Value Percentage of Total Fair Value Percentage of Total Bitcoin $ 156,528,307 48 % $ 89,864,637 47 % Ethereum 62,873,141 19 % 40,200,059 21 % Solana 24,304,478 7 % 12,906,278 6 % Other crypto assets (1) 85,800,551 26 % 49,612,086 26 % Total safeguarding customer crypto assets $ 329,506,477 100 % $ 192,583,060 100 % __________________ (1) Includes various other crypto assets balances, none of which individually represented more than 5% of total Safeguarding customer crypto assets. See Note 14. Fair Value Measurements , for additional details regarding the Safeguarding customer crypto assets and Safeguarding customer crypto liabilities. |
OTHER CURRENT AND NON-CURRENT A
OTHER CURRENT AND NON-CURRENT ASSETS | 3 Months Ended |
Mar. 31, 2024 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER CURRENT AND NON-CURRENT ASSETS | OTHER CURRENT AND NON-CURRENT ASSETS Other current assets and other non-current assets consisted of the following (in thousands): March 31, December 31, 2024 2023 Other current assets Crypto assets held for operations $ 150,630 $ 74,103 Prepaid expenses 98,004 79,552 Assets pledged as collateral (1) 73,096 53,071 Income tax receivable 39,945 63,726 Other 17,862 16,191 Total other current assets $ 379,537 $ 286,643 Other non-current assets Strategic investments $ 346,902 $ 343,045 Property and equipment, net 193,056 192,550 Intangible assets, net 79,755 86,422 Lease right of use assets 10,164 12,737 Deposits and other 23,985 19,840 Total other non-current assets $ 653,862 $ 654,594 _______________ (1) See Note 6. Collateralized Arrangements and Financing for additional details. Crypto assets held for operations The following table summarizes the units, cost basis, and fair value of crypto assets held for operations (in thousands, except units): March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value (1) Bitcoin 101 $ 5,548 $ 7,174 $ 7,243 Ethereum 15,006 44,799 54,565 15,775 Solana 144,193 25,967 29,128 10,275 Other (2) nm 48,077 59,763 40,810 Total held for operations $ 124,391 $ 150,630 $ 74,103 __________________ nm - not meaningful (1) Recorded at impaired cost as of December 31, 2023. (2) Includes various other crypto assets balances, none of which individually represented more than 5% of total Crypto assets held for operations. Measurement alternative investments The changes in the carrying value of strategic investments accounted for under the measurement alternative are presented below (in thousands): March 31, December 31, 2024 2023 Carrying amount, beginning of period $ 330,346 $ 315,285 Net additions (1) 4,527 60,979 Upward adjustments 43 62 Previously held interest in ORDAM (see Note 4) — (20,000) Impairments and downward adjustments (937) (25,980) Carrying amount, end of period $ 333,979 $ 330,346 __________________ (1) Net additions include additions from purchases and reductions due to exits of strategic investments . Upward adjustments, impairments, and downward adjustments from remeasurement of investments are recorded in Other (income) expense, net in the Condensed Consolidated Statements of Operations. As of March 31, 2024, cumulative upward adjustments for investments held as of that date were $5.0 million and cumulative impairments and downward adjustments were $127.6 million. As of December 31, 2023, cumulative upward adjustments for investments held as of that date were $4.9 million and cumulative impairments and downward adjustments were $127.0 million. |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consisted of the following (in thousands): March 31, December 31, 2024 2023 Accrued payroll and payroll related $ 117,309 $ 224,237 Other accrued expenses 126,841 89,254 Income taxes payable 35,222 17,366 Accounts payable 26,825 39,294 Lease liabilities 8,820 10,902 Other payables (1) 123,304 115,130 Total accrued expenses and other current liabilities $ 438,321 $ 496,183 __________________ (1) Includes other payables denominated in crypto assets. See Note 13. Derivatives for additional details. |
LONG-TERM DEBT
LONG-TERM DEBT | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM D The components of long-term debt were as follows as of March 31, 2024 (in thousands, except percentages): Long-term Debt Effective Interest Rate Principal Amount Unamortized Debt Discount and Issuance Costs Net Carrying Amount 0.50% 2026 Convertible Notes due on June 1, 2026 0.98 % $ 1,273,013 $ (13,890) $ 1,259,123 3.38% 2028 Senior Notes due on October 1, 2028 3.57 % 1,000,000 (7,810) 992,190 0.25% 2030 Convertible Notes due on April 1, 2030 0.55 % 1,265,000 (22,038) 1,242,962 3.63% 2031 Senior Notes due on October 1, 2031 3.77 % 737,457 (6,718) 730,739 Total $ 4,275,470 $ (50,456) $ 4,225,014 The components of long-term debt were as follows as of December 31, 2023 (in thousands, except percentages): Long-term Debt Effective Interest Rate Principal Amount Unamortized Debt Discount and Issuance Costs Net Carrying Amount 0.50% 2026 Convertible Notes due on June 1, 2026 0.98 % $ 1,273,013 $ (15,378) $ 1,257,635 3.38% 2028 Senior Notes due on October 1, 2028 3.57 % 1,000,000 (8,218) 991,782 3.63% 2031 Senior Notes due on October 1, 2031 3.77 % 737,457 (6,917) 730,540 Total $ 3,010,470 $ (30,513) $ 2,979,957 2030 Convertible Notes In March 2024, the Company issued an aggregate principal amount of $1.3 billion of convertible senior notes due 2030 (the “2030 Convertible Notes”), which included the full exercise by the initial purchasers of their option to purchase up to an additional $165.0 million aggregate principal amount of the 2030 Convertible Notes, pursuant to an indenture, dated March 18, 2024 between the Company and U.S Bank Trust Company, National Association, as trustee (the “Indenture”). The 2030 Convertible Notes were offered and sold in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The 2030 Convertible Notes are senior unsecured obligations of the Company and accrue interest of 0.25% per year payable semi-annually in arrears on April 1 and October 1 of each year, beginning on October 1, 2024. The 2030 Convertible Notes mature on April 1, 2030, unless earlier repurchased, redeemed or converted. The proceeds received of $1.2 billion, were net of a 1.5% original issue discount. The 2030 Convertible Notes will be convertible into cash, shares of the Company’s Class A common stock, or a combination thereof, at the Company’s election at an initial conversion rate of 2.9981 shares of the Company’s Class A common stock per $1,000 principal amount of notes. This is equivalent to an initial conversion price of approximately $333.54 per share of the Company’s Class A common stock. The conversion rate and conversion price are subject to customary adjustments under certain circumstances in accordance with the terms of the Indenture. The 2030 Convertible Notes will be convertible at the option of the holders after the calendar quarter ending on June 30, 2024, if the last reported sale price per share of Class A common stock exceeds 130% of the conversion price for each of at least 20 trading days, during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter. Upon conversion, the Company may satisfy its conversion obligation by paying or delivering, as applicable, cash, shares of the Company’s Class A common stock or a combination of cash and shares of the Company’s Class A common stock, at the Company’s election, based on the applicable conversion rate. In addition, if certain corporate events that constitute a make-whole fundamental change (as defined in the Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time. Additionally in the event of a corporate event constituting a fundamental change (as defined in the Indenture), holders of the 2030 Convertible Notes may require the Company to repurchase all or a portion of their 2030 Convertible Notes at a repurchase price equal to 100% of the principal amount of the 2030 Convertible Notes being repurchased, plus accrued and unpaid special interest or additional interest, if any, to, but excluding, the date of the fundamental change repurchase. The Company accounted for the 2030 Convertible Notes wholly as debt because (1) the conversion features do not require bifurcation as a derivative under ASC 815 and (2) the 2030 Convertible Notes were not issued at a substantial premium. Debt issuance costs related to the issuance of the 2030 Convertible Notes recognized were $3.2 million, and include commissions payable to the underwriters and third-party offering costs. As of March 31, 2024, the outstanding aggregate principal balance of the 2030 Convertible Notes and the related unamortized discounts were $1.3 billion and $22.0 million, respectively. Capped calls On May 18, 2021, in connection with the pricing of the convertible senior notes due in 2026 (the “2026 Convertible Notes”), on March 13, 2024, in connection with the pricing of the 2030 Convertible Notes, and on March 14, 2024, in connection with the full exercise by the initial purchasers of their option to purchase additional 2030 Convertible Notes, the Company entered into privately negotiated capped call transactions (the “2026 Capped Calls” and “2030 Capped Calls,” respectively, and “the Capped Calls” collectively) with certain financial institutions (the “2026 Option Counterparties” and “2030 Option Counterparties,” respectively and the “Option Counterparties” collectively) at a cost of $90.1 million and $104.1 million, respectively, in each case in exchange for the right to receive a predetermined amount of cash, shares of the Company’s Class A common stock, or a combination thereof, at the Company’s election. The Capped Calls cover, subject to customary adjustments, the number of shares of the Company’s Class A common stock initially underlying each of the 2026 Convertible Notes and 2030 Convertible Notes (collectively, the “Convertible Notes”), as applicable. The Capped Calls allow the Company to hedge the economic effect of the conversion options embedded in the Convertible Notes and purchase shares of its own Class A common stock at a specified strike price. By entering into the Capped Calls, the Company expects to reduce the potential dilution to its Class A common stock (or, in the event a conversion of the Convertible Notes is settled in cash, to reduce its cash payment obligation) in the event that at the time of conversion of the Convertible Notes its Class A common stock price exceeds the conversion price of the Convertible Notes. The 2026 Capped Calls have an initial strike price of approximately $370.45 per share of Class A common stock (the “2026 Initial Strike Price”) and an initial cap price of approximately $478.00 per share of Class A common stock (the “2026 Initial Cap Price”). The 2030 Capped Calls have an initial strike price of approximately $333.54 per share of Class A common stock (the “2030 Initial Strike Price” and, together with the 2026 Initial Strike Price, the “Initial Strike Prices”) and an initial cap price of approximately $503.46 per share of Class A common stock (the “2030 Initial Cap Price” and, together with the 2026 Initial Cap Price, the “Initial Cap Prices”). Upon expiration of the agreements underlying the Capped Calls, the Capped Calls will be automatically exercised. If the closing market price of the Class A common stock is above the applicable Initial Cap Price, the initial investments will be returned with a premium in either cash or shares at the Company’s election. If the closing market price of the Class A common stock is at or below the applicable Initial Strike Price, the Company will receive the number of shares specified i n the agreements. Upon certain extraordinary events, nationalization, insolvency or delisting event, or additional disruption events, the Capped Calls are contractually structured to terminate. The Company has the contractual right to terminate the Capped Calls upon repurchase, redemption or conversion (in the case of conversion, prior to December 1, 2025 or October 1, 2029, for the 2026 Capped Calls and 2030 Capped Calls, respectively) of the underlying Convertible Notes, in certain circumstances. The Capped Calls also include early termination provisions based on beneficial ownership positions of the counterparties. That is, if at any time the counterparty’s holdings exceed 8% beneficial ownership of the Company (as defined under Section 13 of the Exchange Act) and the counterparty is unable, after commercially reasonable efforts, to effect a transfer or assignment of all or a portion of the transaction such that an excess ownership position no longer exists, the counterparty may early terminate a portion of the Capped Calls, in which case the Company can settle in cash or shares of its Class A common stock. |
DERIVATIVES
DERIVATIVES | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVES | DERIVATIVES The following outlines the Company’s derivatives, which were all embedded forward contracts as of March 31, 2024: Location of Host Contract and Derivative on Balance Sheets Description of Derivative Accounts receivable, net The Company provided services for which, under the contract, the counterparty pays a fixed amount in crypto assets in the future. Crypto asset borrowings The Company borrowed crypto assets that resulted in the obligation to deliver a fixed amount of crypto assets in the future. See Note 6. Collateralized Arrangements and Financing for additional information. Obligation to return collateral The Company receives crypto asset collateral that results in the obligation to return collateral received as a fixed amount of crypto assets. See Note 6. Collateralized Arrangements and Financing for additional information. Accrued expenses and other current liabilities The Company entered into arrangements that result in the obligation to deliver a fixed amount of crypto assets in the future. Impact of derivatives on the Condensed Consolidated Balance Sheets The following table summarizes the notional amounts of derivative instruments outstanding, measured in U.S. dollar equivalents (in thousands): March 31, December 31, 2024 2023 Designated as hedges Crypto asset borrowings (1) $ — $ 31,666 Not designated as hedging instrument Accounts receivable denominated in crypto assets 21,362 16,335 Crypto asset borrowings 158,518 12,503 Obligation to return loan collateral 75,424 — Other payables denominated in crypto assets 33,012 20,092 __________________ (1) Prior to the adoption of ASU 2023-08, the Company applied hedge accounting using these derivative instruments in qualifying fair value hedges to hedge the fair value exposure of crypto asset prices for the crypto assets borrowed. As of January 1, 2024, the date of ASU 2023-08 adoption, these derivative instruments have been dedesignated. The following tables summarize information on derivative assets and liabilities that are reflected on the Condensed Consolidated Balance Sheets, by accounting designation (in thousands): Gross Derivative Assets Gross Derivative Liabilities Not Designated as Hedges Designated as Hedges Total Derivative Assets Not Designated as Hedges Designated as Hedges Total Derivative Liabilities March 31, 2024 Accounts receivable denominated in crypto assets $ 41,263 $ — $ 41,263 $ — $ — $ — Crypto asset borrowings 264 — 264 114,551 — 114,551 Obligation to return loan collateral — — — 31,186 — 31,186 Other payables denominated in crypto assets 2,687 — 2,687 4,367 — 4,367 Total fair value of derivative assets and liabilities $ 44,214 $ — $ 44,214 $ 150,104 $ — $ 150,104 December 31, 2023 Accounts receivable denominated in crypto assets $ 28,065 $ — $ 28,065 $ — $ — $ — Crypto asset borrowings 26 (25) 1 5,290 13,522 18,812 Other payables denominated in crypto assets 2,511 — 2,511 3,101 — 3,101 Total fair value of derivative assets and liabilities $ 30,602 $ (25) $ 30,577 $ 8,391 $ 13,522 $ 21,913 Impact of derivatives on the Condensed Consolidated Statements of Operations Gains (losses) on derivative instruments recognized in the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended March 31, 2024 Three Months Ended March 31, 2023 Derivatives Hedged Items Income Statement Impact (4) Derivatives Hedged Items Income Statement Impact Designated as hedging instrument Crypto asset futures (1) $ — $ — $ — $ (43,116) $ 48,491 $ 5,375 Crypto asset borrowings (1) — — — (91,714) 48,600 (43,114) Not designated as hedging instrument Accounts receivable denominated in crypto assets (2) 13,795 — 13,795 42,924 — 42,924 Crypto asset borrowings (3) (95,914) — (95,914) — — — Obligation to return loan collateral (3) (31,186) — (31,186) — — — Other payables denominated in crypto assets (1) (1,721) — (1,721) 439 — 439 Other (1) — — — (213) — (213) Total $ (115,026) $ — $ (115,026) $ (91,680) $ 97,091 $ 5,411 __________________ (1) Changes in fair value are recorded in Other operating expense (income), net in the Condensed Consolidated Statements of Operations. (2) Changes in fair value are recorded in Other (income) expense, net or Other operating expense (income), net in the Condensed Consolidated Statements of Operations depending on the nature of the receivable. (3) Changes in fair value are recorded in Transaction expense in the Condensed Consolidated Statements of Operations. (4) Though the Company has dedesignated crypto assets borrowed that previously qualified as fair value hedges, the impact of derivatives is naturally offset, at least in part, in the Condensed Consolidated Statements of Operations by the impact of associated naturally offsetting positions. See Quantitative and Qualitative Information about Market Risk |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities measured and recorded at fair value on a recurring basis (in thousands): March 31, 2024 December 31, 2023 Level 1 Level 2 Level 1 Level 2 Assets Cash equivalents (1) $ 3,037,792 $ — $ 3,682,917 $ — Customer custodial funds (2) 4,894,429 — 3,301,029 — Crypto asset loan receivables — 196,141 — 22,229 Crypto assets borrowed (3) 231,348 — 45,212 — Safeguarding customer crypto assets — 329,506,477 — 192,583,060 Derivative assets (4) — 44,214 — 30,577 Crypto assets held for operations 150,630 — 74,103 — Crypto assets held as collateral 106,610 — — — Crypto assets held for investment 1,522,328 — 330,610 — Total assets $ 9,943,137 $ 329,746,832 $ 7,433,871 $ 192,635,866 Liabilities Safeguarding customer crypto liabilities $ — $ 329,506,477 $ — $ 192,583,060 Derivative liabilities (4) — 150,104 — 21,913 Obligation to return collateral 106,610 — — — Total liabilities $ 106,610 $ 329,656,581 $ — $ 192,604,973 __________________ (1) Represents money market funds. Excludes $3.5 billion of corporate cash held in deposit at banks and $124.8 million held at venues, which were not measured and recorded at fair value as of March 31, 2024. Excludes $1.4 billion of corporate cash held in deposit at banks and $88.8 million held at venues, which were not measured and recorded at fair value as of December 31, 2023. (2) Represents money market funds. Excludes customer custodial funds of $307.5 million and $1.3 billion held in deposit at financial institutions and not measured and recorded at fair value as of March 31, 2024 and December 31, 2023, respectively. (3) Includes crypto assets held that were designated as hedged items in fair value hedges as of December 31, 2023 and excludes crypto assets of $404.7 million held at cost as of December 31, 2023. (4) See Note 13. Derivatives for additional details. Assets and liabilities measured and recorded at fair value on a non-recurring basis The Company’s non-financial assets, such as goodwill, intangible assets and property and equipment are adjusted to fair value when an impairment charge is recognized. The Company’s crypto assets held, prior to the adoption of ASU 2023-08, and the Company’s strategic investments, are measured at fair value on a non-recurring basis. Fair value of crypto assets held are based predominantly on Level 1 inputs and fair value measurements for strategic investments are based predominantly on Level 3 inputs. The carrying value of the Company’s strategic investments is adjusted based on an Option-Pricing Model that uses publicly available market data of comparable companies and other unobservable inputs including expected volatility, expected time to liquidity, adjustments for other company-specific developments, and the rights and obligations of the securities the Company holds. Assets and liabilities not measured and recorded at fair value The Company’s financial instruments, including certain cash and cash equivalents, restricted cash, certain customer custodial funds, USDC, accounts receivable, fiat loan receivables, fiat collateral, and customer custodial cash liabilities are not measured at fair value. The carrying values of these instruments approximate their fair values due to their liquid or short-term nature. If these financial instruments were recorded at fair value, they would be based on Level 1 inputs. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Stock options A summary of options activity for the three months ended March 31, 2024 is as follows (in thousands, except per share and years data): Options Outstanding Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Balance at January 1, 2024 28,697 $ 25.01 6.1 $ 4,295,055 Exercised (2,338) 18.84 Forfeited and cancelled (24) 30.36 Balance at March 31, 2024 26,335 $ 25.55 5.9 $ 6,309,011 Exercisable at March 31, 2024 20,201 $ 26.19 5.8 $ 4,826,583 Vested and expected to vest at March 31, 2024 20,211 $ 26.18 5.8 $ 4,829,027 During the three months ended March 31, 2024, the Company granted no stock options. As of March 31, 2024, there was total unrecognized compensation cost of $56.0 million related to unvested stock options. These costs are expected to be recognized over a weighted-average period of approximately 2.3 years . R estricted stock units The Company grants restricted stock units (“RSUs”) that vest upon the satisfaction of a service-based condition. In general, the RSUs vest over a service period ranging from one A summary of RSU activity for the three months ended March 31, 2024 is as follows (in thousands, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Balance at January 1, 2024 3,016 $ 108.07 Granted 5,139 142.75 Vested (1,580) 131.48 Forfeited and cancelled (212) 125.33 Balance at March 31, 2024 6,363 $ 129.69 As of March 31, 2024, there was total unrecognized compensation cost of $782.2 million related to unvested RSUs. These costs are expected to be recognized over a weighted-average period of approximately 1.2 years. Performance restricted stock units The Company also grants performance restricted stock units (“PRSUs”), which are subject to either (a) a market condition or (b) the achievement of performance goals. A summary of PRSU activity for the three months ended March 31, 2024 is as follows (in thousands, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Balance at January 1, 2024 804 $ 55.42 Vested (80) 55.42 Balance at March 31, 2024 724 $ 55.42 As of March 31, 2024, there was total unrecognized compensation cost of $13.0 million related to unvested PRSUs. These costs are expected to be recognized over a weighted-average period of approximately 1.7 years. Restricted common stock As part of the Company’s past acquisitions, the Company has issued shares of restricted Class A common stock. Vesting of this restricted Class A common stock is dependent on a service-based vesting condition that is generally satisfied over three years. The Company has the right to repurchase shares, at par value, for which the vesting condition is not satisfied. Activity of restricted Class A common stock is as follows (in thousands, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Balance at January 1, 2024 543 $ 114.22 Vested (182) 129.03 Forfeited and cancelled (4) 267.48 Balance at March 31, 2024 357 $ 104.97 As of March 31, 2024, there was total unrecognized compensation cost o f $24.3 million related to unvested restricted Class A common stock. These costs are expected to be recognized over a weighted-average period of approximately 1.3 years . Stock-based compensation expense The effects of stock-based compensation expense in the Condensed Consolidated Statements of Operations are as follows (in thousands): Three Months Ended March 31, 2024 2023 Technology and development $ 139,830 $ 122,696 Sales and marketing 16,623 14,209 General and administrative 68,051 61,955 Restructuring — 84,042 Total $ 224,504 $ 282,902 During the three months ended March 31, 2024 and 2023, $11.1 million and $14.1 million of stock-based compensation expense was recorded in capitalized software, which is included in Other non-current assets in the accompanying Condensed Consolidated Balance Sheets, respectively. |
OTHER (INCOME) EXPENSE, NET
OTHER (INCOME) EXPENSE, NET | 3 Months Ended |
Mar. 31, 2024 | |
Other Income and Expenses [Abstract] | |
OTHER (INCOME) EXPENSE, NET | OTHER (INCOME) EXPENSE, NET Other (income) expense, net consisted of the following (in thousands): Three Months Ended March 31, 2024 2023 Foreign exchange losses, net $ 1,651 $ 13,878 Strategic investment losses, net 849 6,319 Gains on crypto asset loan receivables (1) (25,526) — Gains on other financial instruments, net (13,186) — Other (9,393) 68 Total Other (income) expense, net $ (45,605) $ 20,265 __________________ (1) Represents unrealized gains on crypto asset loans made from the Company’s portfolio of crypto assets held as investment. See Note 6 . Collateralized Arrangements and Financing for additional details. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES For the three months ended March 31, 2024, the Company calculated the tax provision using a discrete effective tax rate method. Historically, the tax provision was calculated for interim periods using an estimated annual effective tax rate, applied to year-to-date ordinary income. The Company’s estimated annual effective tax rate can fluctuate significantly based on the amount of estimated pretax income or loss in the period. For example, when pretax income is lower, the effect of non-deductible expenses or other discrete items will have a significant impact on the effective tax rate. Therefore, the Company determined the discrete effective tax rate method is the appropriate method for calculating the interim tax provision. The Company’s effective tax rate for the three months ended March 31, 2024 and 2023 was 18.2% and 52.4%, respectively. The effective tax rate of 18.2% for the three months ended March 31, 2024 was lower than the U.S. statutory rate of 21.0% primarily due to the Company’s deductible stock-based compensation and research and development credits. As of March 31, 2024, the Company had a net deferred tax asset balance of $879.7 million, compared to $1.3 billion as of December 31, 2023. The decrease resulted from the deferred tax liability of $177.9 million established upon the adoption of ASU 2023-08 and the deferred tax provision of $214.6 million recorded on pretax earnings and other comprehensive income during the quarter. As of December 31, 2023, the Company had a valuation allowance of $8.7 million recorded against its deferred capital loss tax asset balance of $207.6 million. The Company’s capital loss tax asset is comprised primarily of impairment charges related to crypto assets held and strategic investments made by Coinbase Ventures. As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. As of March 31, 2024, because crypto assets appreciation during the quarter provided more gains to offset losses, management determined that there is sufficient positive evidence to conclude that it is more likely than not that capital loss tax assets are realizable, resulting in a valuation allowance release of $8.7 million for the quarter. |
NET INCOME (LOSS) PER SHARE
NET INCOME (LOSS) PER SHARE | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
NET INCOME (LOSS) PER SHARE | NET INCOME (LOSS) PER SHARE The computation of Net income (loss) p er share is as follows (in thousands, except per share amounts): Three Months Ended March 31, 2024 2023 Basic Net income (loss) per share: Numerator Net income (loss) $ 1,176,245 $ (78,896) Less: Income allocated to participating securities (766) — Net income (loss) attributable to common stockholders, basic $ 1,175,479 $ (78,896) Denominator Weighted-average shares of common stock used to compute Net income (loss) per share attributable to common stockholders, basic 242,793 231,489 Net income (loss) per share attributable to common stockholders, basic $ 4.84 $ (0.34) Diluted Net income (loss) per share: Numerator Net income (loss) $ 1,176,245 $ (78,896) Less: Income allocated to participating securities (697) — Add: Interest on convertible notes, net of tax 2,531 — Net income (loss) attributable to common stockholders, diluted $ 1,178,079 $ (78,896) Denominator Weighted-average shares of common stock used to compute Net income (loss) per share attributable to common stockholders, basic 242,793 231,489 Weighted-average effect of potentially dilutive securities: Stock options 18,534 — Convertible notes 4,145 — RSUs 2,164 — Restricted common stock 309 — Weighted-average shares of common stock used to compute Net income (loss) per share attributable to common stockholders, diluted 267,945 231,489 Net income (loss) per share attributable to common stockholders, diluted $ 4.40 $ (0.34) Certain shares of the Company’s restricted Class A common stock granted as consideration in past acquisitions are participating securities. These participating securities do not contractually require the holders of such shares to participate in the Company’s losses. The rights, including the liquidation and dividend rights, of the holders of Class A common stock and Class B common stock are identical, except with respect to voting. As a result, the undistributed earnings are allocated on a proportionate basis and the resulting income (loss) per share will, therefore, be the same for both Class A common stock and Class B common stock on an individual or combined basis. The following potentially dilutive shares were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive (in thousands): March 31, 2024 2023 Stock options 6,671 31,274 ESPP 733 822 PRSUs 322 — RSUs 292 10,592 Restricted common stock 242 1,004 Convertible notes — 3,880 Contingent consideration — 76 Total 8,260 47,648 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Indemnifications In the event any registrable securities are included in a registration statement, the Company’s Amended and Restated Investors’ Rights Agreement (the “IRA”) entered into with certain of the Company’s stockholders provides indemnity to each stockholder, their partners, members, officers, directors, and stockholders, legal counsel, and accountants; each underwriter, if any; and each person who controls each stockholder or underwriter, against any damages incurred in connection with investigating or defending any claim or proceeding arising as a result of such registration from which damages may result. The Company will reimburse each such party for any legal and any other expenses reasonably incurred, provided that the Company will not be liable in any such case to the extent the damages arise out of or are based upon any actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of such stockholder or underwriter and stated to be specifically for use therein. The Company also has indemnity agreements with certain officers and directors of the Company pursuant to which the Company must indemnify the officer or director against all expenses, judgments, fines, and amounts paid in settlement reasonably incurred in connection with a third party proceeding, if the indemnitee acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the Company, and in the case of a criminal proceeding, had no reasonable cause to believe the indemnitee’s conduct was unlawful. It is not possible to determine the maximum potential exposure under these indemnification agreements: (i) because the facts and circumstances involved in each claim are unique and the Company cannot predict the number or nature of claims that may be made; (ii) due to the unique facts and circumstances involved in each particular agreement; and (iii) due to the requirement for a registration of the Company’s securities before any of the indemnification obligations contemplated in the IRA become effective. The Company has also provided indemnities or similar commitments on standard commercial terms in the ordinary course of business. Legal and regulatory proceedings The Company is subject to various litigation, regulatory investigations, and other legal proceedings that arise in the ordinary course of its business. The Company is also subject to regulatory oversight by numerous regulatory and other governmental agencies. The Company reviews its lawsuits, regulatory investigations, and other legal proceedings on an ongoing basis and provides disclosure and records loss contingencies in accordance with the loss contingencies accounting guidance. In accordance with such guidance, the Company establishes accruals for such matters when potential losses become probable and can be reasonably estimated. If the Company determines that a loss is reasonably possible and the loss or range of loss can be estimated, the Company discloses the possible loss in the Condensed Consolidated Financial Statements . In July and August 2021, three purported securities class actions were filed in the U.S. District Court for the Northern District of California against the Company, its directors, certain of its officers and employees, and certain venture capital and investment firms. The complaints alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act, in connection with the registration statement and prospectus filed in connection with the Direct Listing. In November 2021, these actions were consolidated and recaptioned as In re Coinbase Global Securities Litigation , and an amended complaint was f iled. T he plaintiff seeks, among other relief, unspecified compensatory damages, attorneys’ fees, and costs. The Company disputes the claims in these cases and is vigorously defending against them. Based on the preliminary nature of the proceedings in these cases, the outcome of these matters remain uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time. The Company has subsequently received, and expects to receive in the future, similar shareholder claims. In October 2021, a purported class action captioned Underwood et al. v. Coinbase Global, Inc. , was filed in the U.S. District Court for the Southern District of New York (the “District Court”) against the Company alleging claims under Sections 5, 15(a)(1) and 29(b) of the Exchange Act, and violations of certain California and Florida state statutes. On March 11, 2022, plaintiffs filed an amended complaint adding Coinbase, Inc. and Brian Armstrong as defendants and adding causes of action, including alleging claims under Sections 5, 12(a)(1) and 15 of the Securities Act and violations of certain New Jersey state statutes. Among other relief requested, the plaintiffs sought injunctive relief, unspecified damages, attorneys’ fees and costs. On February 1, 2023, the District Court dismissed all federal claims (with prejudice) and state law claims (without prejudice) against Coinbase Global, Inc., Coinbase, Inc. and Brian Armstrong. Subsequently, on February 9, 2023, the plaintiffs appealed that ruling to the U.S. Court of Appeals for the Second Circuit (the “Court of Appeals”), and the parties completed briefing the appeal on September 13, 2023. Oral argument took place on February 1, 2024 and on April 5, 2024, the Court of Appeals issued a Summary Order affirming the District Court’s dismissal order with respect to the claims alleging violations of the Exchange Act, and reversing the District Court’s dismissal order with respect to the claims alleging violations of the Securities Act and violations of the state statutes. The defendants continue to dispute the claims in this case and intend to vigorously defend against them. Based on the nature of the proceedings in this case, the outcome of this matter remains uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time. In December 2021, a shareholder derivative suit captioned Shin v. Coinbase Global, Inc. , was filed in New York state court against the Company and its directors, alleging breach of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets, and seeking unspecified damages and injunctive relief. The Company has subsequently received, and expects to receive in the future, similar derivative claims. The Company disputes the claims in these cases and intends to vigorously defend against them. Based on the preliminary nature of the proceedings in these cases, the outcome of these matters remain uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time. During 2022, the Company’s subsidiary, Coinbase, Inc., which holds a BitLicense from the New York Department of Financial Services (“NYDFS”) and is therefore subject to examinations and investigations by the NYDFS, was subject to an investigation by the NYDFS relating to its compliance program including compliance with the Bank Secrecy Act and sanctions laws, cybersecurity, and cu stomer support. In January 2023, the NYDFS announced a consent order focused on historical shortcomings in Coinbase, Inc.'s compliance program. Pursuant to the consent order, Coinbase, Inc. paid a $50.0 million penalty in January 2023 and agreed to invest an additional $50.0 million in its compliance function by the end of 2024. In April 2022, a dissenting stockholder to the Company’s acquisition of FairXchange, Inc. (“FairX”) filed a Verified Petition for Appraisal of Stock in the Court of Chancery of the State of Delaware seeking, among other relief, an appraisal of the fair value of their common and preferred shares of FairX stock. Petitioners contend that the valuation of FairX was higher than the valuation ascribed by the parties at the time of the transaction. The case is captioned Hyde Park Venture Partners Fund III, L.P. et al. v. FairXchange, LLC, et al . Trial took place in November 2023 and post-trial briefing and argument was completed on March 5, 2024 and March 22, 2024, respectively. A settlement offer was made and rejected in November 2023. Based on the nature of the proceedings in this case, the outcome of this matter remains uncertain and the Company cannot reasonably estimate the potential impact, if any, on its business or financial statements at this time. In June 2023, the SEC filed a complaint in the District Court against the Company and Coinbase, Inc. alleging that Coinbase, Inc. has acted as an unregistered securities exchange, broker, and clearing agency in violation of Sections 5, 15(a) and 17A(b) of the Exchange Act and that, through its staking program, Coinbase, Inc. has offered and sold securities without registering its offers and sales in violation of Sections 5(a) and 5(c) of the Securities Act. The SEC has also alleged that the Company is liable for the alleged violations as an alleged control person of Coinbase, Inc. The case is captioned SEC v. Coinbase, Inc. et al . The SEC seeks, among other relief, injunctive relief, disgorgement and civil money penalties. The Company and Coinbase, Inc. filed an answer to the SEC complaint in June 2023, dispute the claims in this case, and intend to vigorously defend against them. On August 4, 2023, the Company and Coinbase, Inc. filed a motion for judgment on the pleadings. The SEC filed its response on October 3, 2023 and the Company and Coinbase, Inc. filed their reply on October 24, 2023. Oral argument took place on January 17, 2024. On March 27, 2024, the District Court denied in part the Company and Coinbase, Inc.’s motion for judgment on the pleadings with respect to the SEC’s claims that Coinbase, Inc. has operated as an unregistered securities exchange, broker, and clearing agency and has engaged in an unregistered offer and sale of securities through the Company’s staking program. The District Court dismissed the SEC’s claim that Coinbase, Inc. acts as an unregistered broker through its wallet service. Subsequently, on April 12, 2024, the Company and Coinbase, Inc. filed a motion with the District Court seeking certification of an interlocutory appeal to the Court of Appeals. Based on the preliminary nature of the proceedings in this case, the outcome of this matter remains uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time. An adverse resolution of the SEC’s lawsuit could have a material impact on the Company’s business and financial statements. In June 2023, the Company and Coinbase, Inc. were issued notices, show-cause orders, and cease-and-desist letters, and became the subject of various legal actions initiated by U.S. state securities regulators in the states of Alabama, California, Illinois, Kentucky, Maryland, New Jersey, South Carolina, Vermont, Washington and Wisconsin alleging violations of state securities laws with respect to staking services provided by Coinbase, Inc. In July 2023, the Company and Coinbase, Inc. entered into agreements with state securities regulators in California, New Jersey, South Carolina and Wisconsin, pursuant to which customers in those states will no longer be able to stake new funds, in each case pending final adjudication of the matters. In October 2023, the Company and Coinbase, Inc. entered into a similar agreement with the Maryland state securities regulator. The Company and Coinbase, Inc. dispute the claims of the state securities regulators and intend to vigorously defend against them. Based on the preliminary nature of these actions, the final outcome of these matters remains uncertain and the Company cannot estimate the potential impact on its business or financial statements at this time. An adverse resolution could have a material impact on the Company’s business and financial statements. The Company has, from time to time, received investigative subpoenas and requests from regulators for documents and information about certain customer programs, operations, and existing and intended future products, including the Company’s processes for listing assets, the classification of certain listed assets, its staking programs, and its stablecoin and yield-generating products. Except as otherwise disclosed, the Company believes the ultimate resolution of existing legal and regulatory investigation matters will not have a material adverse effect on the financial condition, results of operations, or cash flows of the Company. However, in light of the uncertainties inherent in these matters, it is possible that the ultimate resolution of one or more of these matters may have a material adverse effect on the Company’s results of operations for a particular period, and future changes in circumstances or additional information could result in additional accruals or resolution in excess of established accruals, which could adversely affect the Company’s results of operations, potentially materially. Tax regulation Current promulgated tax rules related to crypto assets are unclear and require significant judgments to be made in interpretation of the law, including but not limited to the areas of income tax, information reporting, transaction level taxes and the withholding of tax at source. Additional legislation or guidance may be issued by U.S. and non-U.S. governing bodies that may differ significantly from the Company's practices or interpretation of the law, which could have unforeseen effects on the Company’s financial condition and results of operations, and accordingly, the related impact on the Company’s financial condition and results of operations is not estimable. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS Revenue and accounts receivable Certain of the Company’s directors, executive officers, and principal owners, including immediate family members, are users of the Company’s platform. The Company recognized revenue from related party customers of $6.9 million and $3.1 million for the three months ended March 31, 2024 and 2023, respectively. As of March 31, 2024 and December 31, 2023, accounts receivable from related party customers were $4.2 million and $3.4 million, respectively. Customer assets and liabilities Safeguarding customer crypto assets and safeguarding customer crypto liabilities for related parties as of March 31, 2024 and December 31, 2023 were $13.0 billion and $8.8 billion, respectively. Customer custodial funds and Customer custodial cash liabilities for related parties as of March 31, 2024 and December 31, 2023 were $4.5 million and $348.0 million, respectively. O As of March 31, 2024 and December 31, 2023, the Company made strategic investments of an aggregate of $0.1 million and $4.0 million, respectively, in investees in which certain related parties of the Company held an interest over 10%. Expenses and accounts payable During the three months ended March 31, 2024 and 2023, the Company incurred $1.1 million and an immaterial amount, respectively, for professional and consulting services provided by entities affiliated with related parties. As of March 31, 2024 and December 31, 2023, accounts payable to related party parties were $1.3 million and an immaterial amount, respectively. |
SUPPLEMENTAL DISCLOSURES OF CAS
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | 3 Months Ended |
Mar. 31, 2024 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION Changes in operating assets and liabilities affecting cash were as follows (in thousands): Three Months Ended March 31, 2024 2023 USDC $ (299,507) $ 497,303 Accounts receivable (108,802) (67,126) Deposits in transit (21,260) (15,262) Income taxes, net 41,613 (7,608) Other current and non-current assets (3,856) (14,892) Other current and non-current liabilities (82,190) (77,088) Net changes in operating assets and liabilities $ (474,002) $ 315,327 Reconciliation of cash, cash equivalents, and restricted cash (in thousands): Three Months Ended March 31, 2024 2023 Cash and cash equivalents $ 6,711,400 $ 5,018,409 Restricted cash 33,499 26,712 Customer custodial cash 5,002,888 5,293,029 Total cash, cash equivalents, and restricted cash $ 11,747,787 $ 10,338,150 Supplemental schedule of non-cash investing and financing activities were as follows (in thousands): Three Months Ended March 31, 2024 2023 Crypto assets borrowed $ 191,436 $ 170,599 Crypto assets borrowed repaid with crypto assets 77,451 200,151 Crypto asset loans originated 424,248 — Crypto asset loans repaid 286,475 — Non-cash assets received as collateral 90,798 19,116 Non-cash assets received as collateral returned 15,374 45,990 Non-cash assets pledged as collateral 42,020 30,774 Non-cash assets pledged as collateral returned 20,804 10,743 Non-cash consideration paid for business combinations — 51,494 Realized gains on crypto assets held for investment — 48,491 Cumulative-effect adjustment due to the adoption of ASU 2023-08 561,489 — |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net income (loss) | $ 1,176,245 | $ (78,896) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 shares | |
Trading Arrangements, by Individual | |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Jennifer Jones [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On February 29, 2024 , Jennifer Jones, the Company’s Chief Accounting Officer, entered into a Rule 10b5-1 Plan (the “Jones Plan”) providing for the potential sale of up to 47,509 shares of Class A common stock owned by Ms. Jones, including upon the vesting and settlement of restricted stock units for shares of Class A common stock and the exercise of vested stock options for shares of Class A common stock, so long as the market price of the Class A common stock satisfies certain threshold prices specified in the Jones Plan or, in certain circumstances, at the market price, between an estimated start date of May 30, 2024 and February 28, 2025, or earlier, upon the completion of all transactions subject to the trading arrangements specified in the Jones Plan or the occurrence of certain events set forth therein. The Jones Plan provides for the sale of shares of Class A common stock to be received upon the future vesting and settlement of certain outstanding restricted stock units, net of any shares withheld by the Company to satisfy applicable tax obligations. The number of shares to be withheld, and therefore the exact number of shares to be sold pursuant to the Jones Plan, can only be determined upon the occurrence of the future vesting events. For purposes of this disclosure, we have included the maximum aggregate number of shares to be sold without subtracting any shares to be withheld upon future vesting events. |
Name | Jennifer Jones |
Title | Chief Accounting Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | February 29, 2024 |
Arrangement Duration | 274 days |
Aggregate Available | 47,509 |
Frederick Ernest Ehrsam III [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 1, 2024 , Frederick Ernest Ehrsam III, a member of the Company’s board of directors, entered into a Rule 10b5-1 Plan (the “Ehrsam Plan”) providing for the potential sale of up to 614,032 shares of Class A common stock owned by The Frederick Ernest Ehrsam III Living Trust, of which Mr. Ehrsam is trustee, so long as the market price of the Class A common stock satisfies certain threshold prices specified in the Ehrsam Plan, between an estimated start date of June 3, 2024 and December 6, 2024, or earlier, upon the completion of all transactions subject to the trading arrangements specified in the Ehrsam Plan or the occurrence of certain events set forth therein. |
Name | Frederick Ernest Ehrsam III |
Title | member of the Company’s board of directors |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 1, 2024 |
Arrangement Duration | 186 days |
Aggregate Available | 614,032 |
Frederick Wilson [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On February 24, 2024 , Frederick Wilson, a member of the Company’s board of directors, entered into a Rule 10b5-1 Plan (the “Wilson Plan”) providing for the potential sale of up to 95,539 shares of Class A common stock owned by the Frederick & Joanne Wilson 2012 DE Trust, of which Mr. Wilson’s spouse is grantor, so long as the market price of the Class A common stock satisfies certain threshold prices specified in the Wilson Plan, between an estimated start date of May 23, 2024 and May 29, 2026, or earlier, upon the completion of all transactions subject to the trading arrangements specified in the Wilson Plan or the occurrence of certain events set forth therein. |
Name | Frederick Wilson |
Title | member of the Company’s board of directors |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | February 24, 2024 |
Arrangement Duration | 736 days |
Aggregate Available | 95,539 |
Andreessen Horowitz Funds [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On February 23, 2024 , Andreessen Horowitz Fund Ill, L.P., Andreessen Horowitz Fund Ill-A, L.P., Andreessen Horowitz Fund III-B, L.P., Andreessen Horowitz Fund III-Q, L.P., AH Parallel Fund III, L.P., AH Parallel Fund Ill-A, L.P., AH Parallel Fund III-B, L.P., AH Parallel Fund III-Q, L.P., Andreessen Horowitz LSV Fund I, L.P., Andreessen Horowitz LSV Fund I-B, L.P., and Andreessen Horowitz LSV Fund I-Q, L.P. (collectively, the “Funds”), each of which is an affiliate of Marc Andreessen, a member of the Company’s board of directors, entered into a modification of a Rule 10b5-1 Plan adopted on November 29, 2023 (the “Prior a16z Plan” and the Prior a16z Plan, as so modified, the “New a16z Plan”) providing for the potential distribution of up to an aggregate of 14,018,115 shares of Class A common stock owned by the Funds to the limited partners of the Funds, in order to amend certain minimum thresholds applicable to the market price of the Class A common stock at which distributions would be conducted under the New a16z Plan during the period beginning on March 25, 2024 and ending on May 26, 2024, such earlier date as the distribution of all shares specified in the New a16z Plan was completed or the occurrence of certain events set forth therein. Under Rule 10b5-1, the modification of the Prior a16z Plan was deemed to be a termination of an existing plan and an adoption of a new plan. On March 25, 2024, the distribution of all shares specified in the New a16z Plan was completed. |
Name | Andreessen Horowitz Fund |
Title | member of the Company’s board of directors |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | February 23, 2024 |
Arrangement Duration | 62 days |
Aggregate Available | 14,018,115 |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of presentation and preparation | Basis of presentation and preparation The accompanying Condensed Consolidated Financial Statements include the accounts of the Company and its subsidiaries – entities in which the Company holds, directly or indirectly, more than 50% of the voting rights, or where it exercises control. The Condensed Consolidated Financial Statements are unaudited but have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) on the same basis as the audited Consolidated Financial Statements, and in management’s opinion, reflect all adjustments, consisting only of normal, recurring adjustments, that are necessary for the fair presentation of the Company’s Financial Statements. Preparation of the Condensed Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions in the Condensed Consolidated Financial Statements and notes thereto. Certain prior period amounts in the Condensed Consolidated Financial Statements have been reclassified to conform to the current period’s presentation. The unaudited Condensed Consolidated Results of Operations for the three months ended March 31, 2024 are not necessarily indicative of the results to be expected for the full year or any other period and should be read in conjunction with the audited Consolidated Financial Statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the “SEC”) on February 15, 2024 (the “Annual Report”). There were no changes to the Company’s most significant estimates and assumptions, significant accounting policies, or recent accounting pronouncements that were disclosed in Note 2. Summary of Significant Accounting Policies to the audited Consolidated Financial Statements included in the Annual Report, other than as discussed below. |
Concentration of credit risk | Concentration of credit risk The Company’s cash and cash equivalents, restricted cash, customer custodial funds, accounts receivable, loan receivables and deposits are potentially subject to concentration of credit risk. Cash and cash equivalents, restricted cash, and customer custodial funds are primarily placed with financial institutions which are of high credit quality. The Company invests cash and cash equivalents and customer custodial funds primarily in highly liquid, highly rated instruments which are uninsured. The Company may also have corporate deposit balances with financial institutions which exceed the Federal Deposit Insurance Corporation insurance limit of $250,000. The Company has not experienced losses on these accounts and does not believe it is exposed to any significant credit risk with respect to these accounts. The Company also holds cash, restricted cash, and crypto assets at crypto asset trading venues, payment processors, and clearing brokers, and performs a regular assessment of these venues as part of its risk management process. As of March 31, 2024, the Company held $203.3 million at these venues, including $124.8 million in unrestricted cash, $63.6 million in crypto assets, and $14.9 million in restricted deposits. As of December 31, 2023, the Company held $93.5 million at these venues, including $88.8 million in unrestricted cash, an immaterial amount of crypto assets, and $4.7 million in restricted deposits. The issuer of USDC reported that, as of March 31, 2024, underlying reserves were held in cash, short-duration U.S. Treasuries, and overnight U.S. Treasury repurchase agreements within segregated accounts for the benefit of USDC holders. As of March 31, 2024 and December 31, 2023, the Company had five and three counterparties and four and three counterparties, respectively, who accounted for more than 10% of the Company’s recorded loan receivables and unrecorded loans receivable, respectively. As of both March 31, 2024 and December 31, 2023, the Company had two counterparties who accounted for more than 10% of the Company’s Accounts receivable, net. See Note 6. Collateralized Arrangements and Financing for details on collateralization of loan receivables. |
Crypto assets held | Crypto assets held The Company holds crypto assets for investment and operating purposes, as well as borrowed crypto assets and crypto assets held as collateral. Effective January 1, 2024, the Company adopted ASU No. 2023-08, Accounting for and Disclosure of Crypto Assets (“ASU 2023-08”) using a modified retrospective approach. Upon adoption, the Company recognized a fair value adjustment on crypto assets held of $739.5 million and established a deferred tax liability of $177.9 million, for a net cumulative-effect adjustment of $561.5 million increasing retained earnings. As a result of the adoption of ASU 2023-08, the Company introduced four new categories of crypto assets held in the Condensed Consolidated Balance Sheets based on their nature. This updated presentation aligns with the requirements of ASU 2023-08 and describes the purpose of the various types of crypto assets held by the Company. Crypto assets held for investment Crypto assets held for investment are primarily held as long-term holdings. The Company does not engage in regular trading of these crypto assets. The Company may loan crypto assets held for investment through Prime Financing. See Note 6. Collateralized Arrangements and Financing for additional details on Prime Financing. Crypto assets held for investment are initially recorded at cost and are subsequently remeasured at fair value on a specific identification basis at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets held for investment are recognized within Gains on crypto assets held for investment, net in the Condensed Consolidated Statements of Operations. Cash flows from crypto asset investment purchases and sales are recorded in Net cash used in investing activities in the Condensed Consolidated Statements of Cash Flows. Crypto assets held for operations The Company may receive crypto assets as a form of payment for transaction revenue, blockchain rewards, custodial fee revenue, and other subscriptions and services revenue which are recorded in Crypto assets held for operations when received. Crypto assets received as a form of payment are converted to cash nearly immediately or are used timely to fulfill corporate expenses. Crypto assets held for operations are initially recorded at the transaction price of the crypto assets at contract inception and are subsequently remeasured at fair value on a first in first out basis at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets held for operations are recorded in Gains on crypto assets held for operations, net in the Condensed Consolidated Statements of Operations. Cash flows from crypto assets held for operations are recorded as Net changes in operating assets and liabilities in the Condensed Consolidated Statements of Cash Flows. Crypto assets held for operations are recorded in Other current assets in the Condensed Consolidated Balance Sheets. Crypto assets borrowed Crypto assets borrowed represent crypto assets borrowed from third parties to facilitate Prime Financing. Prior to the adoption of ASU 2023-08, crypto assets borrowed were designated as fair value hedges, and accounted for as hybrid instruments, with a liability host contract that contained an embedded derivative based on the changes in fair value of the underlying crypto asset. Contemporaneously with the adoption of ASU 2023-08, the Company dedesignated $62.9 million of crypto assets borrowed that previously qualified as fair value hedges against the corresponding crypto asset borrowing. There was a net zero impact of the cumulative fair value hedge basis adjustments that were reversed and recorded in Transaction expense. As of December 31, 2023, the cumulative amount of fair value hedging adjustment was $3.9 million. Post dedesignation and ASU 2023-08 adoption, crypto assets borrowed by the Company, that have not been loaned out, are recorded in Crypto assets borrowed in the Condensed Consolidated Balance Sheets. Crypto assets borrowed are initially recorded at cost and are subsequently remeasured at fair value using the average costing method at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets borrowed are recorded within Transaction expenses. See Note 6. Collateralized Arrangements and Financing for further details on Crypto assets borrowed and Note 21. Supplemental Disclosures of Cash Flow Information for details on cash flows from crypto assets borrowed included in the supplemental schedule of non-cash investing and financing activities. Crypto assets held as collateral For loans receivable, the Company requires borrowers to pledge collateral on loans offered under Prime Financing. Crypto assets held as collateral are initially recorded at cost if the Company has the right to sell, pledge or rehypothecate and are subsequently remeasured at fair value using the specific identification method at the end of each reporting period, with changes in fair value recognized in net income. Fair value is measured using quoted crypto asset prices at the time of measurement within the Company’s principal market. Fair value gains and losses on Crypto assets held as collateral are recorded in Transaction expenses. See Note 6. Collateralized Arrangements and Financing for additional details on crypto assets borrowed and Note 21. Supplemental Disclosures of Cash Flow Information for details on cash flows from Crypto assets held as collateral included in the supplemental schedule of non-cash investing and financing activities. The following table presents the effects of the changes in presentation in the Condensed Consolidated Balance Sheets (in thousands): December 31, 2023 Previously Reported Adjustment As Adjusted Crypto assets held (1) $ 449,925 $ (449,925) $ — Crypto assets held for investment — 330,610 330,610 Crypto assets held for operations — 74,103 74,103 Crypto assets borrowed — 45,212 45,212 $ 449,925 $ — $ 449,925 _________________ (1) |
Recent accounting pronouncements | Recent accounting pronouncements There have been no new developments to recently issued accounting standards, including the expected dates of adoption and estimated effects on the Company’s Consolidated Financial Statements and footnote disclosures, from those disclosed in the Annual Report. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Accounting standards update and change in accounting principle | The following table presents the effects of the changes in presentation in the Condensed Consolidated Balance Sheets (in thousands): December 31, 2023 Previously Reported Adjustment As Adjusted Crypto assets held (1) $ 449,925 $ (449,925) $ — Crypto assets held for investment — 330,610 330,610 Crypto assets held for operations — 74,103 74,103 Crypto assets borrowed — 45,212 45,212 $ 449,925 $ — $ 449,925 _________________ (1) |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of business acquisitions by acquisition | The total consideration transferred in the acquisition was $96.8 million, consisting of the following (in thousands): Cash $ 30,830 Cash payable 1,005 Previously-held interest on acquisition date 20,000 Class A common stock of the Company 44,995 Total purchase consideration $ 96,830 |
Schedule of recognized identified assets acquired and liabilities assumed | The results of operations and the provisional fair values of the assets acquired and liabilities assumed have been recorded in the Condensed Consolidated Financial Statements as of the date of acquisition. The following table summarizes the fair values of assets acquired and liabilities assumed as of the date of acquisition (in thousands): Goodwill $ 65,764 Intangible assets, net 21,100 Other assets and liabilities, net 9,966 Net assets acquired $ 96,830 |
Schedule of components of finite lived and indefinite lived identifiable intangible assets acquired | The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands, except for years data): Fair Value Useful Life at Acquisition (in years) Licenses $ 1,100 Indefinite Customer relationships 17,100 6 In-process research and development (“IPR&D”) 2,900 N/A |
REVENUE (Tables)
REVENUE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregated revenue by source | The following table presents revenue of the Company disaggregated by revenue source (in thousands): Three Months Ended March 31, 2024 2023 Net revenue Transaction revenue Consumer, net (1) $ 935,212 $ 329,152 Institutional, net 85,392 22,311 Other transaction revenue (1) 56,137 23,250 Total transaction revenue 1,076,741 374,713 Subscription and services revenue Stablecoin revenue 197,317 198,898 Blockchain rewards 150,929 73,749 Interest and finance fee income (2) 66,663 43,313 Custodial fee revenue 32,341 17,043 Other subscription and services revenue (2) 63,686 28,682 Total subscription and services revenue 510,936 361,685 Total net revenue 1,587,677 736,398 Other revenue Corporate interest and other income 49,893 36,131 Total other revenue 49,893 36,131 Total revenue $ 1,637,570 $ 772,529 __________________ (1) During the first quarter of 2024, the Company reclassified Base and payment-related revenue from consumer, net to other transaction revenue. Prior period amounts have been reclassified to conform to current period presentation. (2) During the first quarter of 2024, the Company reclassified Prime Financing fees earned from other subscription and services revenue to interest income, and renamed interest income to interest and finance fee income. Prior period amounts have been reclassified to conform to current period presentation. |
Schedule of revenues disaggregated by geography | In the table below are the revenues disaggregated by geography, based on domicile of the customers, as applicable (in thousands): Three Months Ended March 31, 2024 2023 United States $ 1,353,450 $ 686,769 International (1) 284,120 85,760 Total revenue $ 1,637,570 $ 772,529 __________________ (1) No other individual country accounted for more than 10% of total revenue. |
COLLATERALIZED ARRANGEMENTS A_2
COLLATERALIZED ARRANGEMENTS AND FINANCING (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Schedule of loans and financing receivables | The following table summarizes the Company’s Prime Financing lending arrangements (in thousands): March 31, December 31, 2024 2023 Loan receivables Trade finance receivables $ 122,817 $ — Fiat loan receivables 210,185 171,196 Crypto asset loan receivables 196,141 22,229 Total loan receivables $ 529,143 $ 193,425 Customer loans not meeting recognition criteria USDC $ 268,345 $ 205,645 |
Crypto asset, holding | The Company’s Crypto assets held as collateral and Obligation to return collateral consisted of the following (in thousands, except units): March 31, 2024 December 31, 2023 Units Fair Value Units Fair Value Crypto assets held as collateral Bitcoin (1) 1,495 $ 106,610 — $ — Total held as collateral $ 106,610 $ — Obligation to return collateral Fiat N/A $ 208,480 N/A $ 1,063 Bitcoin 1,495 106,610 — — Total obligation to return collateral $ 315,090 $ 1,063 Customer collateral pledged, not recognized nm $ 1,578,643 nm $ 712,644 __________________ nm - not meaningful (1) The cost basis of bitcoin held as collateral as of March 31, 2024 was $75.4 million. The following table summarizes the units, cost basis, and fair value of crypto assets borrowed (in thousands, except units) and the associated crypto asset borrowings: March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value Crypto assets borrowed Bitcoin 2,688 $ 112,099 $ 191,573 $ 36,368 Ethereum 1,122 2,214 4,093 3,720 Solana 55,575 5,198 11,247 3,516 Other crypto assets (1) nm 14,247 24,435 1,608 Total borrowed $ 133,758 $ 231,348 $ 45,212 Crypto asset borrowings Bitcoin 3,040 $ 128,417 $ 216,703 $ 50,679 Ethereum 5,601 10,655 20,420 7,059 Solana 55,575 5,198 11,247 3,513 Other crypto assets (1) nm 14,248 24,435 1,729 Total borrowings $ 158,518 $ 272,805 $ 62,980 __________________ nm - not meaningful (1) Includes various other crypto assets balances, none of which individually represented more than 5% of total crypto assets borrowed and crypto asset borrowings. The following table summarizes the units, cost basis, and fair value of Crypto assets held for investment (in thousands, except units): March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value (1) Bitcoin 9,183 $ 270,438 $ 654,655 $ 126,614 Ethereum 96,086 190,447 350,267 129,131 Other crypto assets (2) nm 213,922 517,406 74,865 Total held for investment $ 674,807 $ 1,522,328 $ 330,610 __________________ nm - not meaningful (1) Recorded at impaired cost as of December 31, 2023. (2) |
Crypto asset activity | The following table summarizes the reconciliation of Crypto assets held as collateral for the three months ended March 31, 2024 (in thousands): January 1, 2024 Cumulative Adjustment Collateral Received Collateral Returned Gains (1) Losses (1) March 31, 2024 Crypto assets held as collateral $ — $ — $ 90,798 $ (15,374) $ 31,186 $ — $ 106,610 __________________ (1) No cumulative realized gains or losses occurred during the period. The following table summarizes the reconciliation of Crypto assets borrowed for the three months ended March 31, 2024 (in thousands): Additions Dispositions January 1, 2024 Crypto Borrowings Originated Crypto Loans Repaid Crypto Borrowings Repaid Crypto Loans Originated Gains (1) Losses (1) March 31, 2024 Crypto assets borrowed $ 45,212 $ 191,436 $ 285,254 $ (77,451) $ (301,168) $ 88,352 $ (287) $ 231,348 __________________ (1) No cumulative realized gains or losses occurred during the period. The following table summarizes the reconciliation of Crypto assets held for investment for the three months ended March 31, 2024 (in thousands): Transfers January 1, 2024 Cumulative Adjustment (1) Additions (2) Sales From Operating Crypto Loans Originated Crypto Loans Repaid Gains (3) Losses (3) March 31, 2024 Crypto assets held for investment $ 330,610 $ 717,373 $ 3,530 $ (59,726) $ 1,972 $ (123,081) $ 1,221 $ 655,688 $ (5,259) $ 1,522,328 __________________ (1) Fair value adjustment on Crypto assets held for investment upon the Company’s adoption of ASU 2023-08. (2) Additions represent purchases of and staking rewards earned on Crypto assets held for investment. (3) Includes $17.0 million of cumulative realized gains from sales that occurred during the period and no cumulative realized losses. The following table summarizes the units, cost basis, and fair value of crypto assets held for operations (in thousands, except units): March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value (1) Bitcoin 101 $ 5,548 $ 7,174 $ 7,243 Ethereum 15,006 44,799 54,565 15,775 Solana 144,193 25,967 29,128 10,275 Other (2) nm 48,077 59,763 40,810 Total held for operations $ 124,391 $ 150,630 $ 74,103 __________________ nm - not meaningful (1) Recorded at impaired cost as of December 31, 2023. (2) |
Schedule of collateral posted | The Company’s corporate assets pledged as collateral against crypto borrowings consisted of the following (in thousands, except units): March 31, 2024 December 31, 2023 Units Fair Value Units Fair Value Assets pledged as collateral USDC 73,096,425 $ 73,096 51,879,705 $ 51,880 Fiat N/A — N/A 1,191 Total pledged as collateral $ 73,096 $ 53,071 Assets pledged as collateral not meeting derecognition criteria USDC 221,827,262 $ 221,827 29,577,339 $ 29,577 |
ACCOUNTS RECEIVABLE, NET (Table
ACCOUNTS RECEIVABLE, NET (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Receivables [Abstract] | |
Schedule of accounts receivable, net of allowance | Accounts receivable, net of allowance consisted of the following (in thousands): March 31, December 31, 2024 2023 Stablecoin revenue receivable $ 75,499 $ 57,885 Customer fee revenue receivable (1) 32,078 23,603 In-transit customer receivables 88,472 42,562 Other accounts receivable (1) 118,263 66,799 Less: allowance for doubtful accounts receivable (33,955) (22,559) Total accounts receivable, net $ 280,357 $ 168,290 __________________ (1) Includes accounts receivable denominated in crypto assets. See Note 13. Derivatives |
CRYPTO ASSETS HELD FOR INVEST_2
CRYPTO ASSETS HELD FOR INVESTMENT (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Crypto asset, holding | The Company’s Crypto assets held as collateral and Obligation to return collateral consisted of the following (in thousands, except units): March 31, 2024 December 31, 2023 Units Fair Value Units Fair Value Crypto assets held as collateral Bitcoin (1) 1,495 $ 106,610 — $ — Total held as collateral $ 106,610 $ — Obligation to return collateral Fiat N/A $ 208,480 N/A $ 1,063 Bitcoin 1,495 106,610 — — Total obligation to return collateral $ 315,090 $ 1,063 Customer collateral pledged, not recognized nm $ 1,578,643 nm $ 712,644 __________________ nm - not meaningful (1) The cost basis of bitcoin held as collateral as of March 31, 2024 was $75.4 million. The following table summarizes the units, cost basis, and fair value of crypto assets borrowed (in thousands, except units) and the associated crypto asset borrowings: March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value Crypto assets borrowed Bitcoin 2,688 $ 112,099 $ 191,573 $ 36,368 Ethereum 1,122 2,214 4,093 3,720 Solana 55,575 5,198 11,247 3,516 Other crypto assets (1) nm 14,247 24,435 1,608 Total borrowed $ 133,758 $ 231,348 $ 45,212 Crypto asset borrowings Bitcoin 3,040 $ 128,417 $ 216,703 $ 50,679 Ethereum 5,601 10,655 20,420 7,059 Solana 55,575 5,198 11,247 3,513 Other crypto assets (1) nm 14,248 24,435 1,729 Total borrowings $ 158,518 $ 272,805 $ 62,980 __________________ nm - not meaningful (1) Includes various other crypto assets balances, none of which individually represented more than 5% of total crypto assets borrowed and crypto asset borrowings. The following table summarizes the units, cost basis, and fair value of Crypto assets held for investment (in thousands, except units): March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value (1) Bitcoin 9,183 $ 270,438 $ 654,655 $ 126,614 Ethereum 96,086 190,447 350,267 129,131 Other crypto assets (2) nm 213,922 517,406 74,865 Total held for investment $ 674,807 $ 1,522,328 $ 330,610 __________________ nm - not meaningful (1) Recorded at impaired cost as of December 31, 2023. (2) |
Crypto asset activity | The following table summarizes the reconciliation of Crypto assets held as collateral for the three months ended March 31, 2024 (in thousands): January 1, 2024 Cumulative Adjustment Collateral Received Collateral Returned Gains (1) Losses (1) March 31, 2024 Crypto assets held as collateral $ — $ — $ 90,798 $ (15,374) $ 31,186 $ — $ 106,610 __________________ (1) No cumulative realized gains or losses occurred during the period. The following table summarizes the reconciliation of Crypto assets borrowed for the three months ended March 31, 2024 (in thousands): Additions Dispositions January 1, 2024 Crypto Borrowings Originated Crypto Loans Repaid Crypto Borrowings Repaid Crypto Loans Originated Gains (1) Losses (1) March 31, 2024 Crypto assets borrowed $ 45,212 $ 191,436 $ 285,254 $ (77,451) $ (301,168) $ 88,352 $ (287) $ 231,348 __________________ (1) No cumulative realized gains or losses occurred during the period. The following table summarizes the reconciliation of Crypto assets held for investment for the three months ended March 31, 2024 (in thousands): Transfers January 1, 2024 Cumulative Adjustment (1) Additions (2) Sales From Operating Crypto Loans Originated Crypto Loans Repaid Gains (3) Losses (3) March 31, 2024 Crypto assets held for investment $ 330,610 $ 717,373 $ 3,530 $ (59,726) $ 1,972 $ (123,081) $ 1,221 $ 655,688 $ (5,259) $ 1,522,328 __________________ (1) Fair value adjustment on Crypto assets held for investment upon the Company’s adoption of ASU 2023-08. (2) Additions represent purchases of and staking rewards earned on Crypto assets held for investment. (3) Includes $17.0 million of cumulative realized gains from sales that occurred during the period and no cumulative realized losses. The following table summarizes the units, cost basis, and fair value of crypto assets held for operations (in thousands, except units): March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value (1) Bitcoin 101 $ 5,548 $ 7,174 $ 7,243 Ethereum 15,006 44,799 54,565 15,775 Solana 144,193 25,967 29,128 10,275 Other (2) nm 48,077 59,763 40,810 Total held for operations $ 124,391 $ 150,630 $ 74,103 __________________ nm - not meaningful (1) Recorded at impaired cost as of December 31, 2023. (2) |
CUSTOMER ASSETS AND LIABILITI_2
CUSTOMER ASSETS AND LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of customers' cash and crypto positions | The following table presents customers’ cash and safeguarded crypto positions (in thousands): March 31, December 31, 2024 2023 Customer custodial funds $ 5,201,906 $ 4,570,845 Safeguarding customer crypto assets 329,506,477 192,583,060 Total customer assets $ 334,708,383 $ 197,153,905 Customer custodial cash liabilities $ 5,201,906 $ 4,570,845 Safeguarding customer crypto liabilities 329,506,477 192,583,060 Total customer liabilities $ 334,708,383 $ 197,153,905 |
Platform operator, crypto-asset | The following table sets forth the fair values of Safeguarding customer crypto assets as shown on the Condensed Consolidated Balance Sheets (in thousands, except percentages): March 31, 2024 December 31, 2023 Fair Value Percentage of Total Fair Value Percentage of Total Bitcoin $ 156,528,307 48 % $ 89,864,637 47 % Ethereum 62,873,141 19 % 40,200,059 21 % Solana 24,304,478 7 % 12,906,278 6 % Other crypto assets (1) 85,800,551 26 % 49,612,086 26 % Total safeguarding customer crypto assets $ 329,506,477 100 % $ 192,583,060 100 % __________________ (1) Includes various other crypto assets balances, none of which individually represented more than 5% of total Safeguarding customer crypto assets. |
OTHER CURRENT AND NON-CURRENT_2
OTHER CURRENT AND NON-CURRENT ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of prepaid expenses and other current and non-current assets | Other current assets and other non-current assets consisted of the following (in thousands): March 31, December 31, 2024 2023 Other current assets Crypto assets held for operations $ 150,630 $ 74,103 Prepaid expenses 98,004 79,552 Assets pledged as collateral (1) 73,096 53,071 Income tax receivable 39,945 63,726 Other 17,862 16,191 Total other current assets $ 379,537 $ 286,643 Other non-current assets Strategic investments $ 346,902 $ 343,045 Property and equipment, net 193,056 192,550 Intangible assets, net 79,755 86,422 Lease right of use assets 10,164 12,737 Deposits and other 23,985 19,840 Total other non-current assets $ 653,862 $ 654,594 _______________ (1) See Note 6. Collateralized Arrangements and Financing for additional details. |
Crypto asset activity | The following table summarizes the reconciliation of Crypto assets held as collateral for the three months ended March 31, 2024 (in thousands): January 1, 2024 Cumulative Adjustment Collateral Received Collateral Returned Gains (1) Losses (1) March 31, 2024 Crypto assets held as collateral $ — $ — $ 90,798 $ (15,374) $ 31,186 $ — $ 106,610 __________________ (1) No cumulative realized gains or losses occurred during the period. The following table summarizes the reconciliation of Crypto assets borrowed for the three months ended March 31, 2024 (in thousands): Additions Dispositions January 1, 2024 Crypto Borrowings Originated Crypto Loans Repaid Crypto Borrowings Repaid Crypto Loans Originated Gains (1) Losses (1) March 31, 2024 Crypto assets borrowed $ 45,212 $ 191,436 $ 285,254 $ (77,451) $ (301,168) $ 88,352 $ (287) $ 231,348 __________________ (1) No cumulative realized gains or losses occurred during the period. The following table summarizes the reconciliation of Crypto assets held for investment for the three months ended March 31, 2024 (in thousands): Transfers January 1, 2024 Cumulative Adjustment (1) Additions (2) Sales From Operating Crypto Loans Originated Crypto Loans Repaid Gains (3) Losses (3) March 31, 2024 Crypto assets held for investment $ 330,610 $ 717,373 $ 3,530 $ (59,726) $ 1,972 $ (123,081) $ 1,221 $ 655,688 $ (5,259) $ 1,522,328 __________________ (1) Fair value adjustment on Crypto assets held for investment upon the Company’s adoption of ASU 2023-08. (2) Additions represent purchases of and staking rewards earned on Crypto assets held for investment. (3) Includes $17.0 million of cumulative realized gains from sales that occurred during the period and no cumulative realized losses. The following table summarizes the units, cost basis, and fair value of crypto assets held for operations (in thousands, except units): March 31, 2024 December 31, 2023 Units Cost Basis Fair Value Carrying Value (1) Bitcoin 101 $ 5,548 $ 7,174 $ 7,243 Ethereum 15,006 44,799 54,565 15,775 Solana 144,193 25,967 29,128 10,275 Other (2) nm 48,077 59,763 40,810 Total held for operations $ 124,391 $ 150,630 $ 74,103 __________________ nm - not meaningful (1) Recorded at impaired cost as of December 31, 2023. (2) |
Schedule of other investments accounted for under the measurement alternative | The changes in the carrying value of strategic investments accounted for under the measurement alternative are presented below (in thousands): March 31, December 31, 2024 2023 Carrying amount, beginning of period $ 330,346 $ 315,285 Net additions (1) 4,527 60,979 Upward adjustments 43 62 Previously held interest in ORDAM (see Note 4) — (20,000) Impairments and downward adjustments (937) (25,980) Carrying amount, end of period $ 333,979 $ 330,346 __________________ (1) Net additions include additions from purchases and reductions due to exits of strategic investments . |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | Accrued expenses and other current liabilities consisted of the following (in thousands): March 31, December 31, 2024 2023 Accrued payroll and payroll related $ 117,309 $ 224,237 Other accrued expenses 126,841 89,254 Income taxes payable 35,222 17,366 Accounts payable 26,825 39,294 Lease liabilities 8,820 10,902 Other payables (1) 123,304 115,130 Total accrued expenses and other current liabilities $ 438,321 $ 496,183 __________________ (1) Includes other payables denominated in crypto assets. See Note 13. Derivatives for additional details. |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt instruments | The components of long-term debt were as follows as of March 31, 2024 (in thousands, except percentages): Long-term Debt Effective Interest Rate Principal Amount Unamortized Debt Discount and Issuance Costs Net Carrying Amount 0.50% 2026 Convertible Notes due on June 1, 2026 0.98 % $ 1,273,013 $ (13,890) $ 1,259,123 3.38% 2028 Senior Notes due on October 1, 2028 3.57 % 1,000,000 (7,810) 992,190 0.25% 2030 Convertible Notes due on April 1, 2030 0.55 % 1,265,000 (22,038) 1,242,962 3.63% 2031 Senior Notes due on October 1, 2031 3.77 % 737,457 (6,718) 730,739 Total $ 4,275,470 $ (50,456) $ 4,225,014 The components of long-term debt were as follows as of December 31, 2023 (in thousands, except percentages): Long-term Debt Effective Interest Rate Principal Amount Unamortized Debt Discount and Issuance Costs Net Carrying Amount 0.50% 2026 Convertible Notes due on June 1, 2026 0.98 % $ 1,273,013 $ (15,378) $ 1,257,635 3.38% 2028 Senior Notes due on October 1, 2028 3.57 % 1,000,000 (8,218) 991,782 3.63% 2031 Senior Notes due on October 1, 2031 3.77 % 737,457 (6,917) 730,540 Total $ 3,010,470 $ (30,513) $ 2,979,957 |
DERIVATIVES (Tables)
DERIVATIVES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Description of derivatives and related hedge accounting designation | The following outlines the Company’s derivatives, which were all embedded forward contracts as of March 31, 2024: Location of Host Contract and Derivative on Balance Sheets Description of Derivative Accounts receivable, net The Company provided services for which, under the contract, the counterparty pays a fixed amount in crypto assets in the future. Crypto asset borrowings The Company borrowed crypto assets that resulted in the obligation to deliver a fixed amount of crypto assets in the future. See Note 6. Collateralized Arrangements and Financing for additional information. Obligation to return collateral The Company receives crypto asset collateral that results in the obligation to return collateral received as a fixed amount of crypto assets. See Note 6. Collateralized Arrangements and Financing for additional information. Accrued expenses and other current liabilities The Company entered into arrangements that result in the obligation to deliver a fixed amount of crypto assets in the future. |
Schedule of the notional amount of derivative contracts outstanding | The following table summarizes the notional amounts of derivative instruments outstanding, measured in U.S. dollar equivalents (in thousands): March 31, December 31, 2024 2023 Designated as hedges Crypto asset borrowings (1) $ — $ 31,666 Not designated as hedging instrument Accounts receivable denominated in crypto assets 21,362 16,335 Crypto asset borrowings 158,518 12,503 Obligation to return loan collateral 75,424 — Other payables denominated in crypto assets 33,012 20,092 __________________ (1) Prior to the adoption of ASU 2023-08, the Company applied hedge accounting using these derivative instruments in qualifying fair value hedges to hedge the fair value exposure of crypto asset prices for the crypto assets borrowed. As of January 1, 2024, the date of ASU 2023-08 adoption, these derivative instruments have been dedesignated. The following tables summarize information on derivative assets and liabilities that are reflected on the Condensed Consolidated Balance Sheets, by accounting designation (in thousands): Gross Derivative Assets Gross Derivative Liabilities Not Designated as Hedges Designated as Hedges Total Derivative Assets Not Designated as Hedges Designated as Hedges Total Derivative Liabilities March 31, 2024 Accounts receivable denominated in crypto assets $ 41,263 $ — $ 41,263 $ — $ — $ — Crypto asset borrowings 264 — 264 114,551 — 114,551 Obligation to return loan collateral — — — 31,186 — 31,186 Other payables denominated in crypto assets 2,687 — 2,687 4,367 — 4,367 Total fair value of derivative assets and liabilities $ 44,214 $ — $ 44,214 $ 150,104 $ — $ 150,104 December 31, 2023 Accounts receivable denominated in crypto assets $ 28,065 $ — $ 28,065 $ — $ — $ — Crypto asset borrowings 26 (25) 1 5,290 13,522 18,812 Other payables denominated in crypto assets 2,511 — 2,511 3,101 — 3,101 Total fair value of derivative assets and liabilities $ 30,602 $ (25) $ 30,577 $ 8,391 $ 13,522 $ 21,913 |
Schedule of gains (losses) recorded in income | Gains (losses) on derivative instruments recognized in the Condensed Consolidated Statements of Operations were as follows (in thousands): Three Months Ended March 31, 2024 Three Months Ended March 31, 2023 Derivatives Hedged Items Income Statement Impact (4) Derivatives Hedged Items Income Statement Impact Designated as hedging instrument Crypto asset futures (1) $ — $ — $ — $ (43,116) $ 48,491 $ 5,375 Crypto asset borrowings (1) — — — (91,714) 48,600 (43,114) Not designated as hedging instrument Accounts receivable denominated in crypto assets (2) 13,795 — 13,795 42,924 — 42,924 Crypto asset borrowings (3) (95,914) — (95,914) — — — Obligation to return loan collateral (3) (31,186) — (31,186) — — — Other payables denominated in crypto assets (1) (1,721) — (1,721) 439 — 439 Other (1) — — — (213) — (213) Total $ (115,026) $ — $ (115,026) $ (91,680) $ 97,091 $ 5,411 __________________ (1) Changes in fair value are recorded in Other operating expense (income), net in the Condensed Consolidated Statements of Operations. (2) Changes in fair value are recorded in Other (income) expense, net or Other operating expense (income), net in the Condensed Consolidated Statements of Operations depending on the nature of the receivable. (3) Changes in fair value are recorded in Transaction expense in the Condensed Consolidated Statements of Operations. (4) Though the Company has dedesignated crypto assets borrowed that previously qualified as fair value hedges, the impact of derivatives is naturally offset, at least in part, in the Condensed Consolidated Statements of Operations by the impact of associated naturally offsetting positions. See Quantitative and Qualitative Information about Market Risk |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of assets and liabilities | The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities measured and recorded at fair value on a recurring basis (in thousands): March 31, 2024 December 31, 2023 Level 1 Level 2 Level 1 Level 2 Assets Cash equivalents (1) $ 3,037,792 $ — $ 3,682,917 $ — Customer custodial funds (2) 4,894,429 — 3,301,029 — Crypto asset loan receivables — 196,141 — 22,229 Crypto assets borrowed (3) 231,348 — 45,212 — Safeguarding customer crypto assets — 329,506,477 — 192,583,060 Derivative assets (4) — 44,214 — 30,577 Crypto assets held for operations 150,630 — 74,103 — Crypto assets held as collateral 106,610 — — — Crypto assets held for investment 1,522,328 — 330,610 — Total assets $ 9,943,137 $ 329,746,832 $ 7,433,871 $ 192,635,866 Liabilities Safeguarding customer crypto liabilities $ — $ 329,506,477 $ — $ 192,583,060 Derivative liabilities (4) — 150,104 — 21,913 Obligation to return collateral 106,610 — — — Total liabilities $ 106,610 $ 329,656,581 $ — $ 192,604,973 __________________ (1) Represents money market funds. Excludes $3.5 billion of corporate cash held in deposit at banks and $124.8 million held at venues, which were not measured and recorded at fair value as of March 31, 2024. Excludes $1.4 billion of corporate cash held in deposit at banks and $88.8 million held at venues, which were not measured and recorded at fair value as of December 31, 2023. (2) Represents money market funds. Excludes customer custodial funds of $307.5 million and $1.3 billion held in deposit at financial institutions and not measured and recorded at fair value as of March 31, 2024 and December 31, 2023, respectively. (3) Includes crypto assets held that were designated as hedged items in fair value hedges as of December 31, 2023 and excludes crypto assets of $404.7 million held at cost as of December 31, 2023. (4) See Note 13. Derivatives for additional details. |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of activity of options outstanding | A summary of options activity for the three months ended March 31, 2024 is as follows (in thousands, except per share and years data): Options Outstanding Weighted Average Exercise Price per Share Weighted Average Remaining Contractual Life (Years) Aggregate Intrinsic Value Balance at January 1, 2024 28,697 $ 25.01 6.1 $ 4,295,055 Exercised (2,338) 18.84 Forfeited and cancelled (24) 30.36 Balance at March 31, 2024 26,335 $ 25.55 5.9 $ 6,309,011 Exercisable at March 31, 2024 20,201 $ 26.19 5.8 $ 4,826,583 Vested and expected to vest at March 31, 2024 20,211 $ 26.18 5.8 $ 4,829,027 |
Schedule of activity of RSUs outstanding | A summary of RSU activity for the three months ended March 31, 2024 is as follows (in thousands, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Balance at January 1, 2024 3,016 $ 108.07 Granted 5,139 142.75 Vested (1,580) 131.48 Forfeited and cancelled (212) 125.33 Balance at March 31, 2024 6,363 $ 129.69 |
Schedule of activity of PRSUs outstanding | A summary of PRSU activity for the three months ended March 31, 2024 is as follows (in thousands, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Balance at January 1, 2024 804 $ 55.42 Vested (80) 55.42 Balance at March 31, 2024 724 $ 55.42 |
Schedule of activity of restricted Class A common stock | Activity of restricted Class A common stock is as follows (in thousands, except per share data): Number of Shares Weighted-Average Grant Date Fair Value Per Share Balance at January 1, 2024 543 $ 114.22 Vested (182) 129.03 Forfeited and cancelled (4) 267.48 Balance at March 31, 2024 357 $ 104.97 |
Schedule of stock based compensation | The effects of stock-based compensation expense in the Condensed Consolidated Statements of Operations are as follows (in thousands): Three Months Ended March 31, 2024 2023 Technology and development $ 139,830 $ 122,696 Sales and marketing 16,623 14,209 General and administrative 68,051 61,955 Restructuring — 84,042 Total $ 224,504 $ 282,902 |
OTHER (INCOME) EXPENSE, NET (Ta
OTHER (INCOME) EXPENSE, NET (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Other Income and Expenses [Abstract] | |
Schedule of other nonoperating income (expense) | Other (income) expense, net consisted of the following (in thousands): Three Months Ended March 31, 2024 2023 Foreign exchange losses, net $ 1,651 $ 13,878 Strategic investment losses, net 849 6,319 Gains on crypto asset loan receivables (1) (25,526) — Gains on other financial instruments, net (13,186) — Other (9,393) 68 Total Other (income) expense, net $ (45,605) $ 20,265 __________________ (1) Represents unrealized gains on crypto asset loans made from the Company’s portfolio of crypto assets held as investment. See Note 6 . Collateralized Arrangements and Financing for additional details. |
NET INCOME (LOSS) PER SHARE (Ta
NET INCOME (LOSS) PER SHARE (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of computation of net (loss) income per share | The computation of Net income (loss) p er share is as follows (in thousands, except per share amounts): Three Months Ended March 31, 2024 2023 Basic Net income (loss) per share: Numerator Net income (loss) $ 1,176,245 $ (78,896) Less: Income allocated to participating securities (766) — Net income (loss) attributable to common stockholders, basic $ 1,175,479 $ (78,896) Denominator Weighted-average shares of common stock used to compute Net income (loss) per share attributable to common stockholders, basic 242,793 231,489 Net income (loss) per share attributable to common stockholders, basic $ 4.84 $ (0.34) Diluted Net income (loss) per share: Numerator Net income (loss) $ 1,176,245 $ (78,896) Less: Income allocated to participating securities (697) — Add: Interest on convertible notes, net of tax 2,531 — Net income (loss) attributable to common stockholders, diluted $ 1,178,079 $ (78,896) Denominator Weighted-average shares of common stock used to compute Net income (loss) per share attributable to common stockholders, basic 242,793 231,489 Weighted-average effect of potentially dilutive securities: Stock options 18,534 — Convertible notes 4,145 — RSUs 2,164 — Restricted common stock 309 — Weighted-average shares of common stock used to compute Net income (loss) per share attributable to common stockholders, diluted 267,945 231,489 Net income (loss) per share attributable to common stockholders, diluted $ 4.40 $ (0.34) |
Schedule of potentially dilutive shares | The following potentially dilutive shares were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive (in thousands): March 31, 2024 2023 Stock options 6,671 31,274 ESPP 733 822 PRSUs 322 — RSUs 292 10,592 Restricted common stock 242 1,004 Convertible notes — 3,880 Contingent consideration — 76 Total 8,260 47,648 |
SUPPLEMENTAL DISCLOSURES OF C_2
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Supplemental Cash Flow Elements [Abstract] | |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | Changes in operating assets and liabilities affecting cash were as follows (in thousands): Three Months Ended March 31, 2024 2023 USDC $ (299,507) $ 497,303 Accounts receivable (108,802) (67,126) Deposits in transit (21,260) (15,262) Income taxes, net 41,613 (7,608) Other current and non-current assets (3,856) (14,892) Other current and non-current liabilities (82,190) (77,088) Net changes in operating assets and liabilities $ (474,002) $ 315,327 Reconciliation of cash, cash equivalents, and restricted cash (in thousands): Three Months Ended March 31, 2024 2023 Cash and cash equivalents $ 6,711,400 $ 5,018,409 Restricted cash 33,499 26,712 Customer custodial cash 5,002,888 5,293,029 Total cash, cash equivalents, and restricted cash $ 11,747,787 $ 10,338,150 Supplemental schedule of non-cash investing and financing activities were as follows (in thousands): Three Months Ended March 31, 2024 2023 Crypto assets borrowed $ 191,436 $ 170,599 Crypto assets borrowed repaid with crypto assets 77,451 200,151 Crypto asset loans originated 424,248 — Crypto asset loans repaid 286,475 — Non-cash assets received as collateral 90,798 19,116 Non-cash assets received as collateral returned 15,374 45,990 Non-cash assets pledged as collateral 42,020 30,774 Non-cash assets pledged as collateral returned 20,804 10,743 Non-cash consideration paid for business combinations — 51,494 Realized gains on crypto assets held for investment — 48,491 Cumulative-effect adjustment due to the adoption of ASU 2023-08 561,489 — |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Jan. 01, 2024 | Dec. 31, 2022 | |
Concentration Risk [Line Items] | |||||
Assets held at venues | $ 203,300 | $ 93,500 | |||
Unrestricted cash, held at venues | 124,800 | 88,800 | |||
Restricted cash, held at venues | 14,900 | 4,700 | |||
Crypto assets held for operations | 63,600 | 0 | |||
Fair Value | 1,522,328 | ||||
Deferred tax liabilities | 177,900 | ||||
Retained earnings | 8,070,994 | $ 5,674,946 | 6,281,649 | $ 5,454,557 | |
Hedged asset, fair value hedge, cumulative increase (decrease) | (3,900) | ||||
Cumulative adjustment | |||||
Concentration Risk [Line Items] | |||||
Fair Value | 739,500 | ||||
Deferred tax liabilities | 177,900 | ||||
Retained earnings | 561,489 | ||||
Crypto assets borrowed | $ 62,900 | ||||
Retained Earnings | |||||
Concentration Risk [Line Items] | |||||
Retained earnings | $ 3,558,080 | $ 1,646,579 | 1,820,346 | $ 1,725,475 | |
Retained Earnings | Cumulative adjustment | |||||
Concentration Risk [Line Items] | |||||
Retained earnings | $ 561,489 | ||||
Financing Receivable | Customer Concentration Risk | Four customers | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage (more than) | 10% | ||||
Financing Receivable | Customer Concentration Risk | Five Customers | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage (more than) | 10% | ||||
Unrecorded Financing Receivable | Customer Concentration Risk | Three Customers | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage (more than) | 10% | 10% | |||
Accounts Receivable | Customer Concentration Risk | Two Customers | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage (more than) | 10% | 10% | |||
Revenue Benchmark | Customer Concentration Risk | One Customer | |||||
Concentration Risk [Line Items] | |||||
Concentration risk, percentage (more than) | 10% | 10% |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Changes in Presentation (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Crypto assets held | $ 0 | |
Crypto assets held for operations | 74,103 | |
Fair Value | $ 231,348 | 45,212 |
Crypto assets held for investment | 330,610 | |
Crypto Assets | 449,925 | |
Previously Reported | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Crypto assets held | 449,925 | |
Crypto assets held for operations | 0 | |
Fair Value | 0 | |
Crypto assets held for investment | 0 | |
Crypto Assets | 449,925 | |
Cumulative-effect adjustment due to the adoption of Accounting Standards Update 2023-08, net of tax | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Crypto assets held | (449,925) | |
Crypto assets held for operations | 74,103 | |
Fair Value | 45,212 | |
Crypto assets held for investment | 330,610 | |
Crypto Assets | $ 0 |
RESTRUCTURING - Narrative (Deta
RESTRUCTURING - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |
Jan. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Cost and Reserve [Line Items] | |||
Number of positions eliminated, period percent | 21% | ||
Restructuring | $ 0 | $ 144,489,000 | |
Stock-based compensation | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring | 84,000,000 | ||
Employee Severance | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring | 57,700,000 | ||
Other Restructuring | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring | $ 0 |
ACQUISITIONS - Schedule of ORDA
ACQUISITIONS - Schedule of ORDAM purchase consideration (Details) - One River Digital Asset Management, LLC $ in Thousands | Mar. 03, 2023 USD ($) |
Business Acquisition [Line Items] | |
Cash | $ 30,830 |
Cash payable | 1,005 |
Previously-held interest on acquisition date | 20,000 |
Class A common stock of the Company | 44,995 |
Consideration transferred | $ 96,830 |
ACQUISITIONS - Narrative (Detai
ACQUISITIONS - Narrative (Details) - One River Digital Asset Management, LLC $ in Millions | Mar. 03, 2023 USD ($) shares |
Business Acquisition [Line Items] | |
Cash subject to an indemnity holdback | $ 6 |
Number of shares to subject to indemnity holdback (in shares) | shares | 119,991 |
Holdback release term | 18 months |
Total acquisition costs | $ 2.6 |
ACQUISITIONS - Schedule of OR_2
ACQUISITIONS - Schedule of ORDAM net assets acquired (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 03, 2023 |
Business Acquisition [Line Items] | |||
Goodwill | $ 1,139,670 | $ 1,139,670 | |
One River Digital Asset Management, LLC | |||
Business Acquisition [Line Items] | |||
Goodwill | $ 65,764 | ||
Intangible assets, net | 21,100 | ||
Other assets and liabilities, net | 9,966 | ||
Net assets acquired | $ 96,830 |
ACQUISITIONS - Schedule of OR_3
ACQUISITIONS - Schedule of ORDAM finite-lived intangible assets acquired (Details) - One River Digital Asset Management, LLC $ in Thousands | Mar. 03, 2023 USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, net | $ 21,100 |
Licenses | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, net | 1,100 |
IPR&D | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, net | 2,900 |
Customer relationships | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Intangible assets, net | $ 17,100 |
Useful Life at Acquisition (in Years) | 6 years |
REVENUE - Schedule of revenue d
REVENUE - Schedule of revenue disaggregated by source (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Interest and finance fee income | $ 66,663 | $ 43,313 |
Total revenue | 1,637,570 | 772,529 |
Net revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 1,587,677 | 736,398 |
Total transaction revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,076,741 | 374,713 |
Consumer, net | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 935,212 | 329,152 |
Institutional, net | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 85,392 | 22,311 |
Other transaction revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 56,137 | 23,250 |
Subscription and services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 510,936 | 361,685 |
Stablecoin revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 197,317 | 198,898 |
Blockchain rewards | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 150,929 | 73,749 |
Custodial fee revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 32,341 | 17,043 |
Other subscription and services revenue | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 63,686 | 28,682 |
Other revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 49,893 | 36,131 |
Corporate interest and other income | ||
Disaggregation of Revenue [Line Items] | ||
Corporate interest and other income | $ 49,893 | $ 36,131 |
REVENUE - Schedule of revenue_2
REVENUE - Schedule of revenue disaggregated by geographic area (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 1,637,570 | $ 772,529 |
United States | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | 1,353,450 | 686,769 |
International | ||
Disaggregation of Revenue [Line Items] | ||
Total revenue | $ 284,120 | $ 85,760 |
COLLATERALIZED ARRANGEMENTS A_3
COLLATERALIZED ARRANGEMENTS AND FINANCING - Summary of Prime Financing Lending Arrangements (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Receivables [Abstract] | ||
Trade finance receivables | $ 122,817 | $ 0 |
Fiat loans receivable | 210,185 | 171,196 |
Crypto asset loan receivables past due | 196,141 | 22,229 |
Total loan receivables | 529,143 | 193,425 |
USDC receivables | $ 268,345 | $ 205,645 |
COLLATERALIZED ARRANGEMENTS A_4
COLLATERALIZED ARRANGEMENTS AND FINANCING - Additional Information (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Crypto asset, fee on borrowings | 2.30% | 2% |
Minimum | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Assets pledged as collateral, percentage of fair value | 100% | |
Maximum | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Assets pledged as collateral, percentage of fair value | 400% |
COLLATERALIZED ARRANGEMENTS A_5
COLLATERALIZED ARRANGEMENTS AND FINANCING - Crypto Assets Held as Collateral and Obligation to Return (Details) $ in Thousands | Mar. 31, 2024 USD ($) Unit | Dec. 31, 2023 USD ($) Unit |
Crypto Asset, Activity [Line Items] | ||
Crypto assets held as collateral | $ 106,610 | $ 0 |
Obligation to return collateral | 315,090 | 1,063 |
Collateral received | 1,578,643 | 712,644 |
Crypto assets held as collateral | 0 | |
Fiat | ||
Crypto Asset, Activity [Line Items] | ||
Obligation to return collateral | $ 208,480 | $ 1,063 |
Bitcoin | ||
Crypto Asset, Activity [Line Items] | ||
Obligation to return collateral, units | Unit | 1,495 | 0 |
Obligation to return collateral | $ 106,610 | $ 0 |
Asset Pledged as Collateral | ||
Crypto Asset, Activity [Line Items] | ||
Crypto assets held as collateral | $ 106,610 | $ 0 |
Bitcoin | ||
Crypto Asset, Activity [Line Items] | ||
Units | Unit | 9,183 | |
Bitcoin | Asset Pledged as Collateral | ||
Crypto Asset, Activity [Line Items] | ||
Units | Unit | 1,495 | 0 |
Crypto assets held as collateral | $ 106,610 | $ 0 |
Crypto assets held as collateral | $ 75,400 |
COLLATERALIZED ARRANGEMENTS A_6
COLLATERALIZED ARRANGEMENTS AND FINANCING - Reconciliation of Crypto Assets Held as Collateral (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Crypto Asset [Roll Forward] | |
January 1, 2024 | $ 0 |
Collateral Received | 90,798 |
Collateral Returned | (15,374) |
Gains | 31,186 |
Losses | 0 |
March 31, 2024 | 106,610 |
Cumulative adjustment | |
Crypto Asset [Roll Forward] | |
January 1, 2024 | $ 0 |
COLLATERALIZED ARRANGEMENTS A_7
COLLATERALIZED ARRANGEMENTS AND FINANCING - Units, cost basis and fair value of crypto asset borrowings and borrowed (Details) $ in Thousands | Mar. 31, 2024 USD ($) Unit | Dec. 31, 2023 USD ($) |
Crypto assets borrowed | ||
Cost Basis | $ 133,758 | |
Fair Value | 231,348 | $ 45,212 |
Crypto asset borrowings | ||
Cost Basis | 158,518 | |
Fair Value | $ 272,805 | 62,980 |
Bitcoin | ||
Crypto assets borrowed | ||
Units | Unit | 2,688 | |
Cost Basis | $ 112,099 | |
Fair Value | $ 191,573 | 36,368 |
Crypto asset borrowings | ||
Units | Unit | 3,040 | |
Cost Basis | $ 128,417 | |
Fair Value | $ 216,703 | 50,679 |
Ethereum | ||
Crypto assets borrowed | ||
Units | Unit | 1,122 | |
Cost Basis | $ 2,214 | |
Fair Value | $ 4,093 | 3,720 |
Crypto asset borrowings | ||
Units | Unit | 5,601 | |
Cost Basis | $ 10,655 | |
Fair Value | $ 20,420 | 7,059 |
Solana | ||
Crypto assets borrowed | ||
Units | Unit | 55,575 | |
Cost Basis | $ 5,198 | |
Fair Value | $ 11,247 | 3,516 |
Crypto asset borrowings | ||
Units | Unit | 55,575 | |
Cost Basis | $ 5,198 | |
Fair Value | 11,247 | 3,513 |
Other crypto assets | ||
Crypto assets borrowed | ||
Cost Basis | 14,247 | |
Fair Value | 24,435 | 1,608 |
Crypto asset borrowings | ||
Cost Basis | 14,248 | |
Fair Value | $ 24,435 | $ 1,729 |
COLLATERALIZED ARRANGEMENTS A_8
COLLATERALIZED ARRANGEMENTS AND FINANCING - Reconciliation of crypto assets borrowed (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Receivables [Abstract] | |
January 1, 2024 | $ 45,212 |
Crypto Borrowings Originated | 191,436 |
Crypto Loans Repaid | 285,254 |
Crypto Borrowings Repaid | (77,451) |
Crypto Loans Originated | (301,168) |
Gains | 88,352 |
Losses | 287 |
March 31, 2024 | $ 231,348 |
COLLATERALIZED ARRANGEMENTS A_9
COLLATERALIZED ARRANGEMENTS AND FINANCING - Assets pledged as collateral against crypto borrowings (Details) $ in Thousands | Mar. 31, 2024 USD ($) Unit | Dec. 31, 2023 USD ($) Unit |
Crypto Asset, Activity [Line Items] | ||
Fair Value | $ 348,036,477 | $ 206,982,953 |
Asset Pledged as Collateral | ||
Crypto Asset, Activity [Line Items] | ||
Fair Value | $ 73,096 | $ 53,071 |
Asset Pledged as Collateral without Right | ||
Crypto Asset, Activity [Line Items] | ||
Units | Unit | 221,827,262 | 29,577,339 |
Fair Value | $ 221,827 | $ 29,577 |
USDC | ||
Crypto Asset, Activity [Line Items] | ||
Units | Unit | 73,096,425 | 51,879,705 |
USDC | Asset Pledged as Collateral | ||
Crypto Asset, Activity [Line Items] | ||
Fair Value | $ 73,096 | $ 51,880 |
Fiat | Asset Pledged as Collateral | ||
Crypto Asset, Activity [Line Items] | ||
Fair Value | $ 0 | $ 1,191 |
ACCOUNTS RECEIVABLE, NET - Sche
ACCOUNTS RECEIVABLE, NET - Schedule of accounts and loans receivable (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Receivables [Abstract] | ||
Stablecoin revenue receivable | $ 75,499 | $ 57,885 |
Customer fee revenue receivable | 32,078 | 23,603 |
In-transit customer receivables | 88,472 | 42,562 |
Other accounts receivable | 118,263 | 66,799 |
Less: allowance for doubtful accounts receivable | (33,955) | (22,559) |
Total accounts receivable, net | $ 280,357 | $ 168,290 |
CRYPTO ASSETS HELD FOR INVEST_3
CRYPTO ASSETS HELD FOR INVESTMENT - Summary of Units, Cost Basis and Fair Value (Details) $ in Thousands | Mar. 31, 2024 USD ($) Unit | Dec. 31, 2023 USD ($) |
Indefinite-lived Intangible Assets [Line Items] | ||
Cost Basis | $ 674,807 | |
Fair Value | $ 1,522,328 | |
Carrying Value | $ 330,610 | |
Bitcoin | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Units | Unit | 9,183 | |
Cost Basis | $ 270,438 | |
Fair Value | $ 654,655 | |
Carrying Value | 126,614 | |
Ethereum | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Units | Unit | 96,086 | |
Cost Basis | $ 190,447 | |
Fair Value | 350,267 | |
Carrying Value | 129,131 | |
Other crypto assets | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Cost Basis | 213,922 | |
Fair Value | $ 517,406 | |
Carrying Value | $ 74,865 |
CRYPTO ASSETS HELD FOR INVEST_4
CRYPTO ASSETS HELD FOR INVESTMENT - Reconciliation of Crypto Assets Held for Investment (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Crypto Asset [Roll Forward] | ||
January 1, 2024 | $ 330,610 | |
Additions | 3,530 | |
Dispositions | (59,726) | |
From Operating | 1,972 | |
Crypto Loans Originated | (123,081) | |
Crypto Loans Repaid | 1,221 | |
Gains | 655,688 | |
Losses | (5,259) | |
March 31, 2024 | 1,522,328 | |
Cumulative realized gain | 17,000 | |
Realized losses | $ 0 | |
Cumulative adjustment | ||
Crypto Asset [Roll Forward] | ||
Cumulative Adjustment | $ 717,373 |
CRYPTO ASSETS HELD FOR INVEST_5
CRYPTO ASSETS HELD FOR INVESTMENT - Narrative (Details) $ in Millions | Mar. 31, 2024 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Crypto asset subject to selling restriction | $ 264.3 |
CUSTOMER ASSETS AND LIABILITI_3
CUSTOMER ASSETS AND LIABILITIES - Schedule of Customers' Cash and Crypto Positions (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Customer custodial funds | $ 5,201,906 | $ 4,570,845 |
Safeguarding customer crypto assets | 329,506,477 | 192,583,060 |
Total customer assets | 334,708,383 | 197,153,905 |
Customer custodial cash liabilities | 5,201,906 | 4,570,845 |
Safeguarding customer crypto liabilities | 329,506,477 | 192,583,060 |
Total customer liabilities | $ 334,708,383 | $ 197,153,905 |
CUSTOMER ASSETS AND LIABILITI_4
CUSTOMER ASSETS AND LIABILITIES - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Losses incurred in connection with safeguarding customer crypto assets | $ 0 | $ 0 |
CUSTOMER ASSETS AND LIABILITI_5
CUSTOMER ASSETS AND LIABILITIES - Fair Value of Customer Crypto Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Cryptocurrency, by Type [Line Items] | ||
Safeguarding customer crypto assets | $ 329,506,477 | $ 192,583,060 |
Percentage of total | 100% | 100% |
Bitcoin | ||
Cryptocurrency, by Type [Line Items] | ||
Safeguarding customer crypto assets | $ 156,528,307 | $ 89,864,637 |
Percentage of total | 48% | 47% |
Ethereum | ||
Cryptocurrency, by Type [Line Items] | ||
Safeguarding customer crypto assets | $ 62,873,141 | $ 40,200,059 |
Percentage of total | 19% | 21% |
Solana | ||
Cryptocurrency, by Type [Line Items] | ||
Safeguarding customer crypto assets | $ 24,304,478 | $ 12,906,278 |
Percentage of total | 7% | 6% |
Other crypto assets | ||
Cryptocurrency, by Type [Line Items] | ||
Safeguarding customer crypto assets | $ 85,800,551 | $ 49,612,086 |
Percentage of total | 26% | 26% |
OTHER CURRENT AND NON-CURRENT_3
OTHER CURRENT AND NON-CURRENT ASSETS - Schedule of prepaid expenses and other current and non-current assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Other current assets | ||
Crypto assets held for operations | $ 150,630 | |
Crypto assets held for operations | $ 74,103 | |
Prepaid expenses | 98,004 | 79,552 |
Assets pledged as collateral | 73,096 | 53,071 |
Income tax receivable | 39,945 | 63,726 |
Other | 17,862 | 16,191 |
Total other current assets | 379,537 | 286,643 |
Other non-current assets | ||
Strategic investments | 346,902 | 343,045 |
Property and equipment, net | 193,056 | 192,550 |
Intangible assets, net | 79,755 | 86,422 |
Lease right-of-use assets | 10,164 | 12,737 |
Deposits and other | 23,985 | 19,840 |
Total other non-current assets | $ 653,862 | $ 654,594 |
OTHER CURRENT AND NON-CURRENT_4
OTHER CURRENT AND NON-CURRENT ASSETS - Crypto assets held for operation (Details) $ in Thousands | Mar. 31, 2024 USD ($) Unit | Dec. 31, 2023 USD ($) |
Crypto Asset, Activity [Line Items] | ||
Cost Basis | $ 124,391 | |
Fair Value | 150,630 | |
Carrying Value | $ 74,103 | |
Bitcoin | ||
Crypto Asset, Activity [Line Items] | ||
Cost Basis | 5,548 | |
Fair Value | $ 7,174 | |
Units | Unit | 101 | |
Carrying Value | 7,243 | |
Ethereum | ||
Crypto Asset, Activity [Line Items] | ||
Cost Basis | $ 44,799 | |
Fair Value | $ 54,565 | |
Units | Unit | 15,006 | |
Carrying Value | 15,775 | |
Solana | ||
Crypto Asset, Activity [Line Items] | ||
Cost Basis | $ 25,967 | |
Fair Value | $ 29,128 | |
Units | Unit | 144,193 | |
Carrying Value | 10,275 | |
Other crypto assets | ||
Crypto Asset, Activity [Line Items] | ||
Cost Basis | $ 48,077 | |
Fair Value | $ 59,763 | |
Carrying Value | $ 40,810 |
OTHER CURRENT AND NON-CURRENT_5
OTHER CURRENT AND NON-CURRENT ASSETS - Schedule of other investments accounted for under the measurement alternative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Equity Securities without Readily Determinable Fair Value [Roll Forward] | ||
Carrying amount, beginning of period | $ 330,346 | $ 315,285 |
Net additions | 4,527 | 60,979 |
Upward adjustments | 43 | 62 |
Previously held interest in ORDAM | 0 | (20,000) |
Impairments and downward adjustments | (937) | (25,980) |
Carrying amount, end of period | $ 333,979 | $ 330,346 |
OTHER CURRENT AND NON-CURRENT_6
OTHER CURRENT AND NON-CURRENT ASSETS - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Upward adjustments due to remeasurement of investments | $ 5 | $ 4.9 |
Impairment loss and downward adjustments | $ 127.6 | $ 127 |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Schedule of accounts payable and accrued expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Payables and Accruals [Abstract] | ||
Accrued payroll and payroll related | $ 117,309 | $ 224,237 |
Other accrued expenses | 126,841 | 89,254 |
Income taxes payable | 35,222 | 17,366 |
Accounts payable | 26,825 | 39,294 |
Lease liabilities, current | 8,820 | 10,902 |
Other payables | 123,304 | 115,130 |
Total accrued expenses and other current liabilities | $ 438,321 | $ 496,183 |
LONG-TERM DEBT - Schedule of Lo
LONG-TERM DEBT - Schedule of Long Term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument [Line Items] | ||
Principal Amount | $ 4,275,470 | $ 3,010,470 |
Unamortized Debt Discount and Issuance Costs | (50,456) | (30,513) |
Net Carrying Amount | $ 4,225,014 | $ 2,979,957 |
Convertible notes | 2026 Convertible Notes | ||
Debt Instrument [Line Items] | ||
Debt instrument, stated percentage | 0.50% | 0.50% |
Effective Interest Rate | 0.98% | 0.98% |
Principal Amount | $ 1,273,013 | $ 1,273,013 |
Unamortized Debt Discount and Issuance Costs | (13,890) | (15,378) |
Net Carrying Amount | $ 1,259,123 | $ 1,257,635 |
Convertible notes | 2030 Convertible Notes | ||
Debt Instrument [Line Items] | ||
Debt instrument, stated percentage | 0.25% | |
Effective Interest Rate | 0.55% | |
Principal Amount | $ 1,265,000 | |
Unamortized Debt Discount and Issuance Costs | (22,038) | |
Net Carrying Amount | $ 1,242,962 | |
Senior Notes | 2028 Senior Notes | ||
Debt Instrument [Line Items] | ||
Debt instrument, stated percentage | 3.38% | 3.38% |
Effective Interest Rate | 3.57% | 3.57% |
Principal Amount | $ 1,000,000 | $ 1,000,000 |
Unamortized Debt Discount and Issuance Costs | (7,810) | (8,218) |
Net Carrying Amount | $ 992,190 | $ 991,782 |
Senior Notes | 2031 Senior Notes | ||
Debt Instrument [Line Items] | ||
Debt instrument, stated percentage | 3.63% | 3.63% |
Effective Interest Rate | 3.77% | 3.77% |
Principal Amount | $ 737,457 | $ 737,457 |
Unamortized Debt Discount and Issuance Costs | (6,718) | (6,917) |
Net Carrying Amount | $ 730,739 | $ 730,540 |
LONG-TERM DEBT - Narrative (Det
LONG-TERM DEBT - Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | ||||
Mar. 13, 2024 USD ($) $ / shares | May 18, 2021 USD ($) $ / shares | Mar. 31, 2024 USD ($) day $ / shares | Mar. 31, 2024 USD ($) $ / shares | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Debt Instrument [Line Items] | ||||||
Proceeds from convertible debt | $ 1,246,025 | $ 0 | ||||
Outstanding aggregate principal | $ 4,275,470 | 4,275,470 | $ 3,010,470 | |||
Purchase of capped calls | $ 104,100 | $ 90,100 | ||||
Option strike price (in dollars per share) | $ / shares | $ 333.54 | $ 370.45 | ||||
Cap price per share (in dollars per share) | $ / shares | $ 503.46 | $ 478 | ||||
2030 Convertible Notes | ||||||
Debt Instrument [Line Items] | ||||||
Conversion ratio | 0.0029981 | |||||
2030 Convertible Notes | Convertible notes | ||||||
Debt Instrument [Line Items] | ||||||
Face amount of debt | $ 1,300,000 | 1,300,000 | ||||
Additional principal available | $ 165,000 | $ 165,000 | ||||
Debt instrument, stated percentage | 0.25% | 0.25% | ||||
Proceeds from convertible debt | $ 1,200,000 | |||||
Original issue discount | 1.50% | 1.50% | ||||
Conversion price (in dollars per share) | $ / shares | $ 333.54 | $ 333.54 | ||||
Threshold percentage of stock price trigger | 130% | |||||
Threshold trading days | day | 20 | |||||
Threshold consecutive trading days | day | 30 | |||||
Repurchase price, percentage | 100% | |||||
Unamortized debt issuance costs | $ 3,200 | $ 3,200 | ||||
Outstanding aggregate principal | 1,265,000 | 1,265,000 | ||||
Original issue discount | $ 22,000 | $ 22,000 | ||||
Convertible Senior Notes due 2026 | Convertible notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, stated percentage | 0.50% | 0.50% | 0.50% | |||
Outstanding aggregate principal | $ 1,273,013 | $ 1,273,013 | $ 1,273,013 | |||
2028 Senior Notes | Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, stated percentage | 3.38% | 3.38% | 3.38% | |||
Outstanding aggregate principal | $ 1,000,000 | $ 1,000,000 | $ 1,000,000 | |||
2031 Senior Notes | Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, stated percentage | 3.63% | 3.63% | 3.63% | |||
Outstanding aggregate principal | $ 737,457 | $ 737,457 | $ 737,457 |
DERIVATIVES - Description of de
DERIVATIVES - Description of derivatives and related hedge accounting designation (Details) | Mar. 31, 2024 | Dec. 31, 2023 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Accounts receivable, net | Accounts receivable, net |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities, Crypto Asset, Fair Value, Borrowings | Accrued expenses and other current liabilities, Crypto Asset, Cost, Borrowings |
DERIVATIVES - Schedule of notio
DERIVATIVES - Schedule of notional amount of derivative contracts outstanding (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Accounts receivable denominated in crypto assets | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Notional amount of derivative contracts outstanding in native units | $ 21,362 | $ 16,335 |
Crypto asset borrowings | Designated as hedging instrument | ||
Derivative [Line Items] | ||
Notional amount of derivative contracts outstanding in native units | 0 | 31,666 |
Crypto asset borrowings | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Notional amount of derivative contracts outstanding in native units | 158,518 | 12,503 |
Obligation to return loan collateral | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Notional amount of derivative contracts outstanding in native units | 75,424 | 0 |
Other payables denominated in crypto assets | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Notional amount of derivative contracts outstanding in native units | $ 33,012 | $ 20,092 |
DERIVATIVES - Schedule of deriv
DERIVATIVES - Schedule of derivative assets and liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | $ 44,214 | $ 30,577 |
Gross Derivative Liabilities | 150,104 | 21,913 |
Accounts receivable denominated in crypto assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 41,263 | 28,065 |
Gross Derivative Liabilities | 0 | 0 |
Crypto asset borrowings | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 264 | 1 |
Gross Derivative Liabilities | 114,551 | 18,812 |
Obligation to return loan collateral | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 0 | |
Gross Derivative Liabilities | 31,186 | |
Other payables denominated in crypto assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 2,687 | 2,511 |
Gross Derivative Liabilities | 4,367 | 3,101 |
Not designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 44,214 | 30,602 |
Gross Derivative Liabilities | 150,104 | 8,391 |
Not designated as hedging instrument | Accounts receivable denominated in crypto assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 41,263 | 28,065 |
Gross Derivative Liabilities | 0 | 0 |
Not designated as hedging instrument | Crypto asset borrowings | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 264 | 26 |
Gross Derivative Liabilities | 114,551 | 5,290 |
Not designated as hedging instrument | Obligation to return loan collateral | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 0 | |
Gross Derivative Liabilities | 31,186 | |
Not designated as hedging instrument | Other payables denominated in crypto assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 2,687 | 2,511 |
Gross Derivative Liabilities | 4,367 | 3,101 |
Designated as hedging instrument | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 0 | (25) |
Gross Derivative Liabilities | 0 | 13,522 |
Designated as hedging instrument | Accounts receivable denominated in crypto assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 0 | 0 |
Gross Derivative Liabilities | 0 | 0 |
Designated as hedging instrument | Crypto asset borrowings | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 0 | (25) |
Gross Derivative Liabilities | 0 | 13,522 |
Designated as hedging instrument | Obligation to return loan collateral | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 0 | |
Gross Derivative Liabilities | 0 | |
Designated as hedging instrument | Other payables denominated in crypto assets | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Derivative Assets | 0 | 0 |
Gross Derivative Liabilities | $ 0 | $ 0 |
DERIVATIVES - Schedule of gains
DERIVATIVES - Schedule of gains (losses) recorded in income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | $ (115,026) | $ (91,680) |
Hedged Items | 0 | 97,091 |
Income Statement Impact | (115,026) | 5,411 |
Crypto asset futures | Designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | 0 | (43,116) |
Hedged Items | 0 | 48,491 |
Income Statement Impact | 0 | 5,375 |
Crypto asset borrowings | Designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | 0 | (91,714) |
Hedged Items | 0 | 48,600 |
Income Statement Impact | 0 | (43,114) |
Crypto asset borrowings | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | (95,914) | 0 |
Hedged Items | 0 | 0 |
Income Statement Impact | (95,914) | 0 |
Accounts receivable denominated in crypto assets | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | 13,795 | 42,924 |
Hedged Items | 0 | 0 |
Income Statement Impact | 13,795 | 42,924 |
Obligation to return loan collateral | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | (31,186) | 0 |
Hedged Items | 0 | 0 |
Income Statement Impact | (31,186) | 0 |
Other payables denominated in crypto assets | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | (1,721) | 439 |
Hedged Items | 0 | 0 |
Income Statement Impact | (1,721) | 439 |
Other | Not designated as hedging instrument | ||
Derivative [Line Items] | ||
Derivatives | 0 | (213) |
Hedged Items | 0 | 0 |
Income Statement Impact | $ 0 | $ (213) |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of fair value of assets and liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | $ 6,711,400 | $ 5,139,351 | $ 5,018,409 |
Fair Value | 231,348 | 45,212 | |
Safeguarding customer crypto assets | 329,506,477 | 192,583,060 | |
Derivative assets | 44,214 | 30,577 | |
Crypto assets held for operations | 63,600 | 0 | |
Fair Value | 1,522,328 | ||
Safeguarding customer crypto liabilities | 329,506,477 | 192,583,060 | |
Derivative liabilities | 150,104 | 21,913 | |
Obligation to return collateral | 315,090 | 1,063 | |
Crypto assets held at cost excluded from fair value assets | 404,700 | ||
Deposits Held At Banks | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 3,500,000 | 1,400,000 | |
Customer custodial funds | 307,500 | 1,300,000 | |
Cash Held At Venues | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 124,800 | 88,800 | |
Level 1 | Fair Value, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 3,037,792 | 3,682,917 | |
Customer custodial funds | 4,894,429 | 3,301,029 | |
Crypto asset loan receivables | 0 | 0 | |
Fair Value | 231,348 | 45,212 | |
Safeguarding customer crypto assets | 0 | 0 | |
Derivative assets | 0 | 0 | |
Crypto assets held for operations | 150,630 | 74,103 | |
Crypto assets held as collateral | 106,610 | 0 | |
Fair Value | 1,522,328 | 330,610 | |
Total assets | 9,943,137 | 7,433,871 | |
Safeguarding customer crypto liabilities | 0 | 0 | |
Derivative liabilities | 0 | 0 | |
Obligation to return collateral | 106,610 | 0 | |
Total liabilities | 106,610 | 0 | |
Level 2 | Fair Value, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | 0 | 0 | |
Customer custodial funds | 0 | 0 | |
Crypto asset loan receivables | 196,141 | 22,229 | |
Fair Value | 0 | 0 | |
Safeguarding customer crypto assets | 329,506,477 | 192,583,060 | |
Derivative assets | 44,214 | 30,577 | |
Crypto assets held for operations | 0 | 0 | |
Crypto assets held as collateral | 0 | 0 | |
Fair Value | 0 | 0 | |
Total assets | 329,746,832 | 192,635,866 | |
Safeguarding customer crypto liabilities | 329,506,477 | 192,583,060 | |
Derivative liabilities | 150,104 | 21,913 | |
Obligation to return collateral | 0 | 0 | |
Total liabilities | $ 329,656,581 | $ 192,604,973 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) - Level 2 $ in Billions | Mar. 31, 2024 USD ($) |
Convertible Senior Notes due 2026 | Convertible notes | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of notes | $ 1.4 |
2030 Convertible Notes | Convertible notes | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of notes | 1.3 |
2028 and 2031 Senior Notes | Senior Notes | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair value of notes | $ 1.5 |
STOCK-BASED COMPENSATION - Sche
STOCK-BASED COMPENSATION - Schedule of stock option activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Options Outstanding | ||
Beginning balance (in shares) | 28,697 | |
Exercised (in shares) | (2,338) | |
Forfeited and cancelled (in shares) | (24) | |
Ending balance (in shares) | 26,335 | 28,697 |
Weighted Average Exercise Price per Share | ||
Options outstanding, weighted average exercise price per share - Beginning balance (in dollars per share) | $ 25.01 | |
Options exercised, weighted average exercise price per share (in dollars per share) | 18.84 | |
Options forfeited and cancelled, weighted average exercise price per share (in dollars per share) | 30.36 | |
Options outstanding, weighted average exercise price per share - Ending balance (in dollars per share) | $ 25.55 | $ 25.01 |
Stock Option Activity, Additional Disclosures | ||
Options outstanding, Weighted average remaining contractual term | 5 years 10 months 24 days | 6 years 1 month 6 days |
Options outstanding, Aggregate intrinsic value | $ 6,309,011 | $ 4,295,055 |
Options vested and exercisable, Number of options (in shares) | 20,201 | |
Options vested and exercisable , Weighted average exercise price per share (in dollars per share) | $ 26.19 | |
Options vested and exercisable, Weighted average remaining contractual term | 5 years 9 months 18 days | |
Options vested and exercisable, Aggregate intrinsic value | $ 4,826,583 | |
Options vested and expected to vest, Number of options (in shares) | 20,211 | |
Options vested and expected to vest, Weighted average exercise price per share (in dollars per share) | $ 26.18 | |
Options vested and expected to vest, Weighted average remaining contractual term | 5 years 9 months 18 days | |
Options vested and expected to vest, Aggregate intrinsic value | $ 4,829,027 |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total unrecognized compensation cost related to unvested stock options | $ 56,000 | |
Stock based compensation expense | 224,504 | $ 282,902 |
Share based payment arrangement, capitalized | $ 11,100 | $ 14,100 |
Class A common stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Assumed options from acquisition (in shares) | 0 | |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost, weighted-average period of recognition | 2 years 3 months 18 days | |
RSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost, weighted-average period of recognition | 1 year 2 months 12 days | |
Total unrecognized compensation cost | $ 782,200 | |
Granted (in shares) | 5,139,000 | |
RSUs | Minimum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock based compensation vesting period | 1 year | |
RSUs | Maximum | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock based compensation vesting period | 4 years | |
PRSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost, weighted-average period of recognition | 1 year 8 months 12 days | |
PRSUs | Share-based Payment Arrangement, Tranche Two | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total unrecognized compensation cost | $ 13,000 | |
Restricted common stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock based compensation vesting period | 3 years | |
Unrecognized compensation cost, weighted-average period of recognition | 1 year 3 months 18 days | |
Total unrecognized compensation cost | $ 24,300 |
STOCK-BASED COMPENSATION - Sc_2
STOCK-BASED COMPENSATION - Schedule of restricted stock unit and restricted stock activity (Details) shares in Thousands | 3 Months Ended |
Mar. 31, 2024 $ / shares shares | |
RSUs | |
Number of Shares | |
Beginning balance (in shares) | shares | 3,016 |
Granted (in shares) | shares | 5,139 |
Vested (in shares) | shares | (1,580) |
Forfeited and cancelled (in shares) | shares | (212) |
Ending balance (in shares) | shares | 6,363 |
Weighted-Average Grant Date Fair Value Per Share | |
Beginning balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares | $ 108.07 |
Granted, Weighted-average grant date fair value per share (in dollars per share) | $ / shares | 142.75 |
Vested, Weighted-average grant date fair value per share (in dollars per share) | $ / shares | 131.48 |
Forfeited and cancelled, Weighted-average grant date fair value per share (in dollars per share) | $ / shares | 125.33 |
Ending balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares | $ 129.69 |
Restricted common stock | |
Number of Shares | |
Beginning balance (in shares) | shares | 543 |
Vested (in shares) | shares | (182) |
Forfeited and cancelled (in shares) | shares | (4) |
Ending balance (in shares) | shares | 357 |
Weighted-Average Grant Date Fair Value Per Share | |
Beginning balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares | $ 114.22 |
Vested, Weighted-average grant date fair value per share (in dollars per share) | $ / shares | 129.03 |
Forfeited and cancelled, Weighted-average grant date fair value per share (in dollars per share) | $ / shares | 267.48 |
Ending balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares | $ 104.97 |
STOCK-BASED COMPENSATION - Sc_3
STOCK-BASED COMPENSATION - Schedule of performance restricted stock unit (Details) - PRSUs shares in Thousands | 3 Months Ended |
Mar. 31, 2024 $ / shares shares | |
Number of Shares | |
Beginning balance (in shares) | shares | 804 |
Vested (in shares) | shares | (80) |
Ending balance (in shares) | shares | 724 |
Weighted-Average Grant Date Fair Value Per Share | |
Beginning balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares | $ 55.42 |
Vested, Weighted-average grant date fair value per share (in dollars per share) | $ / shares | 55.42 |
Ending balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares | $ 55.42 |
STOCK-BASED COMPENSATION - Sc_4
STOCK-BASED COMPENSATION - Schedule of stock based compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock based compensation expense | $ 224,504 | $ 282,902 |
Technology and development | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock based compensation expense | 139,830 | 122,696 |
Sales and marketing | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock based compensation expense | 16,623 | 14,209 |
General and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock based compensation expense | 68,051 | 61,955 |
Restructuring | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Stock based compensation expense | $ 0 | $ 84,042 |
OTHER (INCOME) EXPENSE, NET (De
OTHER (INCOME) EXPENSE, NET (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Other Income and Expenses [Abstract] | ||
Foreign exchange losses, net | $ 1,651 | $ 13,878 |
Strategic investment losses, net | 849 | 6,319 |
Gain (Loss) On Crypto Asset Loans Receivable | (25,526) | 0 |
Gains on other financial instruments, net | (13,186) | 0 |
Other | (9,393) | 68 |
Other (income) expense, net | $ (45,605) | $ 20,265 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |||
Effective income tax rate | 18.20% | 52.40% | |
U.S. statutory rate | 21% | ||
Deferred tax assets | $ 879,671 | $ 1,272,233 | |
Deferred tax liabilities | 177,900 | ||
Deferred income taxes | 214,600 | ||
Valuation allowance | 8,700 | ||
Capital losses - realized / unrealized | $ 207,600 | ||
Partial valuation allowance release | $ 8,700 |
NET INCOME (LOSS) PER SHARE - S
NET INCOME (LOSS) PER SHARE - Schedule of net income per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Numerator | ||
Net income (loss) | $ 1,176,245 | $ (78,896) |
Less: Income allocated to participating securities | (766) | 0 |
Net income (loss) attributable to common stockholders, basic | $ 1,175,479 | $ (78,896) |
Denominator | ||
Weighted-average shares of common stock used to compute net loss per share attributable to common stockholders, basic (in shares) | 242,793 | 231,489 |
Net loss per share attributable to common stockholders, basic (in dollars per share) | $ 4.84 | $ (0.34) |
Numerator | ||
Net income (loss) | $ 1,176,245 | $ (78,896) |
Less: Income allocated to participating securities | (697) | 0 |
Add: Interest on convertible notes, net of tax | 2,531 | 0 |
Net income (loss) attributable to common stockholders, diluted | $ 1,178,079 | $ (78,896) |
Denominator | ||
Weighted-average shares of common stock used to compute net loss per share attributable to common stockholders, basic (in shares) | 242,793 | 231,489 |
Convertible notes (in shares) | 4,145 | 0 |
Weighted-average shares of common stock used to compute net (loss) income per share attributable to common stockholders, diluted (in shares) | 267,945 | 231,489 |
Net income loss per share attributable to common stockholders, diluted (in dollars per share) | $ 4.40 | $ (0.34) |
Stock options | ||
Denominator | ||
Weighted-average effect of potentially dilutive securities (in shares) | 18,534 | 0 |
RSUs | ||
Denominator | ||
Weighted-average effect of potentially dilutive securities (in shares) | 2,164 | 0 |
Restricted common stock | ||
Denominator | ||
Weighted-average effect of potentially dilutive securities (in shares) | 309 | 0 |
NET INCOME (LOSS) PER SHARE -_2
NET INCOME (LOSS) PER SHARE - Schedule of potentially dilutive shares (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 8,260 | 47,648 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 6,671 | 31,274 |
ESPP | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 733 | 822 |
PRSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 322 | 0 |
RSUs | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 292 | 10,592 |
Restricted common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 242 | 1,004 |
Convertible notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 0 | 3,880 |
Contingent consideration | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of shares excluded in the computation of diluted earnings per share | 0 | 76 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 1 Months Ended | 2 Months Ended |
Jan. 31, 2023 USD ($) | Aug. 31, 2021 class_action_case | |
Commitments and Contingencies Disclosure [Abstract] | ||
Number of purported securities class actions filed | class_action_case | 3 | |
Penalty awarded | $ 50 | |
Amount to be invested in company compliance function | $ 50 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Related Party Transaction [Line Items] | |||
Revenue | $ 1,637,570 | $ 772,529 | |
Safeguarding customer crypto assets | 329,506,477 | $ 192,583,060 | |
Safeguarding customer crypto liabilities | 329,506,477 | 192,583,060 | |
Customer custodial cash liabilities | 5,201,906 | 4,570,845 | |
Related Party | |||
Related Party Transaction [Line Items] | |||
Revenue | 6,900 | 3,100 | |
Amounts receivable from customers, net of allowance | 4,200 | 3,400 | |
Safeguarding customer crypto assets | 13,000,000 | 8,800,000 | |
Safeguarding customer crypto liabilities | 13,000,000 | 8,800,000 | |
Custodial cash funds, current | 4,500 | 348,000 | |
Customer custodial cash liabilities | 4,500 | 348,000 | |
Investments and other assets | 100 | 4,000 | |
Professional and consulting services | 1,100 | $ 0 | |
Accounts payable | $ 1,300 | $ 0 |
SUPPLEMENTAL DISCLOSURES OF C_3
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION - Changes in Operating Assets and Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | ||
USDC | $ (299,507) | $ 497,303 |
Accounts receivable | (108,802) | (67,126) |
Deposits in transit | (21,260) | (15,262) |
Income taxes, net | 41,613 | (7,608) |
Other current and non-current assets | (3,856) | (14,892) |
Other current and non-current liabilities | (82,190) | (77,088) |
Net changes in operating assets and liabilities | $ (474,002) | $ 315,327 |
SUPPLEMENTAL DISCLOSURES OF C_4
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION - Reconciliation of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 | Dec. 31, 2022 |
Supplemental Cash Flow Elements [Abstract] | ||||
Cash and cash equivalents | $ 6,711,400 | $ 5,139,351 | $ 5,018,409 | |
Restricted cash | 33,499 | 22,992 | 26,712 | |
Customer custodial funds | 5,002,888 | 5,293,029 | ||
Total cash, cash equivalents, and restricted cash | $ 11,747,787 | $ 9,555,448 | $ 10,338,150 | $ 9,429,646 |
SUPPLEMENTAL DISCLOSURES OF C_5
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION - Non-cash Investing and Financing Activities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Supplemental Cash Flow Elements [Abstract] | ||
Crypto assets borrowed | $ 191,436 | $ 170,599 |
Crypto assets borrowed repaid with crypto assets | 77,451 | 200,151 |
Crypto asset loans originated | 424,248 | 0 |
Crypto asset loans repaid | 286,475 | 0 |
Non-cash assets received as collateral | 90,798 | 19,116 |
Non-cash assets received as collateral returned | 15,374 | 45,990 |
Non-cash assets pledged as collateral | 42,020 | 30,774 |
Non-cash assets pledged as collateral returned | 20,804 | 10,743 |
Non-cash consideration paid for business combinations | 0 | 51,494 |
Realized gains on crypto assets held for investment | 0 | 48,491 |
Cumulative-effect adjustment due to the adoption of ASU 2023-08 | $ 561,489 | $ 0 |