Coinbase earnings reports It carries weight because US cryptocurrency exchanges hold material market share in a growing segment of the digital economy. In addition, it is a key data point for determining the health of the active novice investor and the current crypto market. Naturally, TechCrunch was all over the recently released financial data, pulling a few key takeaways out of the mix.
However, in Coinbase’s Q2 2022 earnings cycle, regulatory disclosures in recent filings with the US Securities and Exchange Commission have drawn attention, so we’re digging deeper this morning.
Regulatory risk is always a consideration when discussing financial technology companies. Any business that handles money in motion must comply with large and complex rules that have been written over time to help a country’s financial markets function smoothly, with minimal fraud and unregulated volatility.
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However, because the technology market can move faster than government regulations, companies that are at the forefront of changes in financial technology can operate in a regulatory gray area. This creates a gap between what the government sets and what the market provides. That’s where we identify regulatory risk, and that zone of uncertainty holds billions and billions of dollars of economic activity.