TLDR

• BlackRock said advisors should consider Bitcoin, gold, and liquid alternatives as portfolio diversifiers.
• The firm reported that stock and bond correlations have remained elevated since 2020.
• BlackRock found that Bitcoin had a 0.53 correlation with the S&P 500 from 2022 to early 2026.
• The report showed that gold recorded a 0.19 correlation with equities during the same period.
• BlackRock said Bitcoin and gold had a 0.10 correlation, which may support combined allocations.

BlackRock has urged financial advisors to reassess diversification strategies as stock and bond correlations remain elevated. The firm said traditional 60/40 portfolios have lost reliability since 2020 due to rising volatility and tighter asset relationships. In a May 6 report, BlackRock outlined how Bitcoin, gold, and liquid alternatives may help diversify multi-asset portfolios.

Bitcoin Emerges as Equity-funded Diversifier

BlackRock published its report titled “How to diversify with bitcoin, gold and alternative investments” on May 6. The firm stated that geopolitical and economic shocks have reduced the effectiveness of traditional diversification tools. It said bonds no longer provide the same hedge against equity drawdowns as in the 2010s.

The report showed that Bitcoin posted a 0.53 correlation with the S&P 500 from 2022 through the first quarter of 2026. By comparison, gold recorded a 0.19 correlation with equities during the same period. BlackRock said the iShares Bitcoin Trust ETF has displayed lower equity correlation than many traditional assets.

BlackRock described Bitcoin as a “unique diversifier” due to its distinct return drivers. The firm linked Bitcoin’s long-term adoption to concerns about monetary stability and US fiscal sustainability. It also connected adoption trends to geopolitical and political stability factors.

The asset manager reiterated that a 1% to 2% Bitcoin allocation may suit multi-asset investors. It said allocations above that range could sharply raise overall portfolio risk. BlackRock stated that advisors should fund Bitcoin exposure from equities due to its volatility profile.

Gold and Liquid Alternatives Strengthen Portfolio Mix

BlackRock highlighted gold as a complementary asset within diversified portfolios. The firm reported that Bitcoin and gold showed a 0.10 correlation from 2022 through early 2026. It said combining both assets could enhance diversification benefits.

The report explained that gold maintained a lower equity correlation than Bitcoin during the measured period. However, BlackRock said the two assets together may provide broader risk dispersion. It emphasized that the low correlation between them supports combined allocations.

BlackRock also promoted liquid alternative strategies within its Target Allocation with Alternatives models. The firm said these strategies aim to reduce portfolio risk without sacrificing upside potential. It stated that most alternative allocations draw funding from fixed-income positions.

However, BlackRock treated Bitcoin differently within its allocation framework. The firm said Bitcoin requires equity funding due to higher volatility compared to gold and alternatives. It added that even small allocations can influence overall portfolio characteristics.

Bitcoin traded near $79,900 at press time after falling 2% on the day. The cryptocurrency had briefly climbed above $82,000 earlier on Wednesday before losing momentum. Traditional markets also eased after posting gains over the previous month.

Blockchain protocols preparing for the quantum computing threat should also consider how to quickly verify ownership on the blockchain if funds are stolen, the development and research team behind the layer-1 NEAR Protocol said.

Concerns that quantum computers could eventually break blockchain cryptography have fueled worries about private keys and wallet security, but most of the conversation has focused on preventing such attacks.

“We won’t be able to tell if someone running a transaction is the rightful owner of the asset or not,” Near One’s chief technology officer, Anton Astafiev, said on Wednesday, adding that blockchain protocols would be forced to make tough decisions on whether to freeze compromised crypto wallets.

“Protocols will face the challenge of deciding to either block all assets at this moment, or enter a wild west,” Astafiev said.

Astafiev suggested that zero-knowledge proof technology could enable the rightful owner to demonstrate knowledge of the original seed phrase without revealing sensitive information.

“This is one example of how research across blockchain ecosystems is essential and valuable as everyone prepares for quantum unknowns.”

Source: NEAR

The push comes after researchers at Google and the California Institute of Technology said in March that functional quantum computers could arrive sooner than expected and would need far less computing power to break cryptography than previously thought.

Google claimed that quantum computers could potentially break Bitcoin’s cryptography within 10 minutes, allowing hackers to perform an “on-spend” attack.

Astafiev said Near One is researching how to solve the problem of not knowing whether a transaction is made by the owner or not.

He also noted that NEAR developers are building a post-quantum-safe signing system for the layer-1 blockchain, which secures more than $137.6 million in user funds.

One of the first quantum solutions being implemented on NEAR is “FIPS-204,” which has been approved by the US National Institute of Standards and Technology and is set to launch on testnet by the end of the second quarter. 

Other crypto ecosystems are taking swift action, too.

Related: Quantum computer breaks 15-bit elliptic curve cryptographic key 

The Ethereum Foundation created the Post-Quantum Ethereum team to build quantum solutions into Ethereum at the protocol level by 2029.

Two of Solana’s validator clients, Anza and Firedancer, have also implemented a test version of Falcon, a new post-quantum signature solution, to help prepare the Solana network for future quantum threats. 

The Bitcoin community has also begun looking at ways to tackle the problem.

Blockstream CEO Adam Back said in April that current quantum computers are “basically lab experiments,” backing up earlier claims that quantum computers are decades away. 

Still, he recommended that Bitcoin developers start looking at building quantum solutions.

Magazine: Nobody knows if quantum secure cryptography will even work

BNY has partnered with Abu Dhabi-based Finstreet and ADI Foundation to develop institutional digital asset custody services for clients in the United Arab Emirates.

The initial focus is on Bitcoin and Ether custody for Finstreet’s existing clients, with plans to later extend to ADI Foundation’s blockchain infrastructure, the world’s largest custodian said in a Thursday announcement. The companies said they intend to expand the product scope to include stablecoins, tokenized real-world assets and other regulated digital instruments, though no timeline was given.

“BNY is uniquely positioned to connect traditional and digital financial ecosystems,” Hani Kablawi, executive vice chair at BNY, said. BNY claimed it is the first US global systemically important bank to offer digital asset custody.

The three firms will offer digital asset custody services from the Abu Dhabi Global Market (ADGM), an international financial center and free zone on Al Maryah Island. The initiative remains subject to definitive agreements and regulatory approvals, according to BNY.

Related: UAE free zone launches blockchain-based business IDs for registered firms

UAE stablecoin infrastructure expands

Finstreet is a subsidiary of Sirius International Holding, which is backed by UAE conglomerate IHC. IHC recently joined other institutions in launching DDSC, a dirham-backed stablecoin regulated by the UAE central bank. The stablecoin operates on ADI Chain, an institutional layer-2 blockchain developed by ADI Foundation.

PUSD, a Shariah-compliant stablecoin backed by reserves denominated in Saudi riyals and UAE dirhams, is also expected to launch on ADI Chain.

In 2025, ADI Chain signed memoranda of understanding with BlackRock, Mastercard and Franklin Templeton tied to tokenized asset settlement and digital financial infrastructure.

The UAE has continued developing its digital asset regulatory framework and tokenization infrastructure in recent years, licensing firms including Animoca Brands, BitGo and Binance while introducing rules covering tokenized stocks, ETFs and crypto derivatives.

Cointelegraph reached out to BNY for a comment, but had not received a response by publication.

Related: UAE investors buy AI dip, keep crypto exposure despite conflict

UAE stablecoins launch regulated conversion rail

The BNY collaboration comes as Abu Dhabi firms push deeper into regulated digital asset infrastructure.

In a Thursday announcement, AE Coin and USD Universal said they are building a regulated conversion rail that allows near-instant exchange between the UAE dirham-pegged AE Coin and the US dollar-backed USDU stablecoin, targeting institutional payments and treasury management.

The system runs on Al Maryah Community Bank’s infrastructure and will initially be accessible through Aquanow and Changer.ae, two regulated digital asset service providers in the UAE.

Magazine: Guide to the top and emerging global crypto hubs: Mid-2026

TrustedVolumes, an independent market maker and resolver used by 1inch Fusion, confirmed it was exploited and said about $6.7 million in stolen funds are being held across three Ethereum addresses.

In a Thursday X post, the market maker said the stolen funds were split across three wallets, with two addresses each holding about $3 million and a third holding about $700,000. TrustedVolumes said it was open to “constructive communication” over a bug bounty and a “mutually acceptable resolution.”

The confirmation came after Web3 security company Blockaid said its exploit detection system had identified an ongoing Ethereum exploit targeting TrustedVolumes. Blockaid said the attack involved a TrustedVolumes-controlled custom swap infrastructure. Blockaid initially estimated that about $5.87 million had been extracted, including Wrapped Ether, USDT, Wrapped Bitcoin and USDC.

Blockchain security company CertiK said the attacker registered as an allowed order signer through a public function, then used that authorization to execute orders that transferred funds from the targets.

The incident highlights the risks around third-party infrastructure used in decentralized exchange execution, where resolvers and market makers can operate their own contracts even when the core protocol and ordinary users are not directly affected. TrustedVolumes operates independently as a liquidity provider for multiple protocols, including 1inch, which said its own systems, infrastructure and user funds were not affected.

Cointelegraph reached out to TrustedVolumes for additional comment but had not received a response by publication. 

Source: TrustedVolumes

1inch says none of its protocols were breached

In an X post, 1inch said reports linking it directly to the TrustedVolumes exploit were “misleading,” adding that “neither 1inch nor any of the 1inch protocols are involved.” The platform said there was “no impact on 1inch systems, infrastructure or user funds.”

1inch co-founder Sergej Kunz also said TrustedVolumes operates independently and is not exclusive to 1inch. “While it is true that 1inch uses TrustedVolumes as a resolver, we are one of many,” Kunz said.

Kunz said the framing of the exploit as a 1inch-related incident was “confusing and harmful,” adding that 1inch is monitoring the situation with security partners and will assist where appropriate.

Related: Andre Cronje says DeFi is ‘no longer DeFi’ as builders debate circuit breakers

Security researcher Vladimir Sobolev, known as Officer’s Notes on X, also told Cointelegraph there was “no risk for 1inch users,” adding that the exploit was related only to TrustedVolumes. 

Sobolev said the exploit points to broader weaknesses in crypto security practices, where vulnerabilities can quickly produce immediate losses. 

“We lack security in general. Blockchains just tend to have an immediate payoff,” Sobolev told Cointelegraph. “We need to pay more attention to kill switches, monitoring, circuit breakers, etc.”

Both Blockaid and Sobolev noted that the attack was carried out by the same operator responsible for the March 2025 1inch Fusion V1 resolver exploit. However, Blockaid said the latest attack involved a different vulnerability.

In March 2025, 1inch said a vulnerability affected resolvers using an outdated Fusion v1 implementation in their own contracts, while end-user funds remained safe. SlowMist later traced about $5 million in stolen assets, including USDC and Wrapped Ether.

1inch and the affected resolver negotiated with the attacker, who returned most of the stolen funds under a bug bounty agreement, according to 1inch and Decurity’s postmortem.

Magazine: North Korea denies crypto hacks, Upbit’s bank tests Ripple: Asia Express

TLDR

• Shopify Inc stock rose 3.55% on May 7 and outperformed the Software and IT Services sector, which gained 2.16%.
• The company exceeded analyst expectations for revenue and earnings per share in the first quarter of 2026.
• Gross Merchandise Volume remained above $100 billion for the second consecutive quarter.
• The stock initially declined after Shopify issued softer second-quarter revenue guidance.
• Market sentiment improved as investors reassessed the company’s overall financial strength and long-term strategy.

Shopify Inc (SHOP) stock rose 3.55% on May 7, outpacing the Software & IT Services sector, which gained 2.16%. The rally followed renewed focus on the company’s first-quarter 2026 earnings and strategic updates. Trading activity also highlighted strong turnover in Microsoft Corp, Palantir Technologies Inc, and Meta Platforms Inc.

Shopify Inc., SHOP

Shopify Inc Stock Rebounds After Earnings Reassessment

Shopify released its Q1 2026 results on May 5 and exceeded analyst estimates for revenue and earnings per share. The company reported Gross Merchandise Volume above $100 billion for the second consecutive quarter. It also maintained healthy free cash flow margins and reported growth in Merchant Solutions revenue.

However, the stock declined on May 5 and May 6 after management issued softer second-quarter revenue guidance. Executives projected slower growth compared with the first quarter, which prompted short-term selling pressure. Despite that reaction, the May 7 rebound indicated that traders reassessed the guidance in context with overall performance.

Shopify highlighted higher AI-driven order volumes during the quarter, reflecting expanded product capabilities. The company also continued to grow its fintech offerings and international operations. Management emphasized disciplined cost control and sustained margin performance during its earnings call.

Sector Performance and Market Activity Support Gains

The broader Software & IT Services sector advanced 2.16% during the same session. Microsoft Corp climbed 2.76%, while Palantir Technologies Inc gained 4.58%. Meta Platforms Inc added 1.66%, placing them among the top three stocks by turnover in the sector.

Analysts responded to the earnings report by adjusting certain price targets while maintaining favorable ratings. Several firms reiterated “Buy” or “Outperform” recommendations following the results. Consensus estimates still point to implied upside from current trading levels.

Institutional activity also drew attention during the week. Cathie Wood’s ARK ETFs purchased Shopify shares on May 5 and May 6. The company also has an authorized share buyback program, which signals management’s confidence in its capital position.

Shopify confirmed that Merchant Solutions revenue expanded year over year in Q1 2026. The company also reiterated its focus on scaling AI tools across merchant services. It reported that GMV exceeded $100 billion again, closing the quarter with steady operational metrics.

Jack Dorsey’s payments firm Block rose 7.9% in after-hours trading as its Q1 earnings surpassed analyst estimates, despite posting its first loss in three years.

Block’s Q1 earnings came in at 85 cents per share, beating the Zacks consensus estimate of 68 cents per share. Investors responded positively, driving Block shares to $75.70 after hours, Google Finance data shows.

“This quarterly report represents an earnings surprise of +25.68%,” said Zacks Equity Research on Thursday. “Over the last four quarters, the company has surpassed consensus EPS estimates two times.”

Expanding Bitcoin’s use into the payments space has been a key area of focus for Dorsey, who previously argued that widespread payment adoption is needed to fulfill Satoshi Nakamoto’s original vision of Bitcoin as a peer-to-peer electronic cash system. In late April, Block noted that over 800,000 US-based merchants have enabled Bitcoin transactions for everyday purchases.

Block reports first quarterly loss in three years 

The earnings beat came despite Block reporting its first quarterly loss since 2023, driven by a 23.8% drop in the price of Bitcoin over the three-month period.

Q1 net loss was $309 million, which included a $172.8 million bitcoin remeasurement loss on the 8,883 Bitcoin it held as of March 31. 

Bitcoin revenue from Cash App and other Block products fell to $1.8 billion from $2.33 billion a year ago.

Block attributed the fall to “Bitcoin trading dynamics” and a “strategic decision to reduce the fee” charged on certain Bitcoin transactions on Cash App.

Block’s gross profit rises 27% in Q1

Block’s Q1 gross profit — net sales minus cost of goods sold — reached $2.9 billion, up 27% from a year earlier. 

Bitcoin payments in Cash App contributed $63 million to Block’s gross profit, while Square had no meaningful impact on Block’s Bitcoin business.

Avory & Co. founder and chief investment officer Sean Emory said “Block had a strong quarter,” having “beat and raised” its guidance.

Source: Jevgenijs Kazanins 

The quarter also included a restructuring overhaul in late February, when Dorsey announced about 4,000 staff cuts, representing roughly 40% of the company’s workforce, as part of a plan to rely more on AI in search of greater operational efficiency. Block’s operational expenses rose 57.2% year-on-year to $3.08 billion in Q1.

Cash App’s quarter-over-quarter change in gross profit. Source: Block

Block expands Bitcoin offerings

In late April, Block launched a proof-of-reserves for its corporate Bitcoin treasury and for users to confirm Bitcoin balances on Cash App and Square as part of a push to increase transparency with its customer base. 

Related: Bitcoin exchange reserves fall to two-year low after $8B exodus 

In the same announcement, Block unveiled a Bitkey hardware wallet with a touchscreen to verify transactions and a new feature on Cash App allowing certain users to automatically convert payments into Bitcoin. 

It also started offering 5% Bitcoin cash back rewards for Square merchants and raised customer withdrawal limits fivefold to $10,000 per day and $25,000 per week, extending Dorsey’s push to broaden Bitcoin’s role in everyday payments. 

Magazine: Guide to the top and emerging global crypto hubs — Mid-2026 

Coinbase Global Inc. entered 2026 with a sobering first-quarter performance, delivering a net loss and revenue figures that underscored the headwinds facing the crypto industry. The exchange posted a $394.1 million net loss for Q1, marking a second consecutive quarterly loss after a $667 million shortfall in Q4 2025, and a meaningful drift away from profitability despite revenue coming in below expectations.

The company reported revenue of $1.41 billion for the quarter, trailing consensus estimates of around $1.5 billion. Earnings per share stood at a loss of $1.49, compared with analysts’ expectations for a positive 36-cent print. The quarterly results arrive as macro conditions remained challenging for crypto trading and related services, weighing on Coinbase’s topline and margins alike.

On the call accompanying the release, Coinbase CFO Alesia Haas stressed the broader market backdrop, noting that “macro conditions were genuinely tough” and that the total crypto market capitalization and overall trading volume declined by more than 20% quarter over quarter. The numbers reflect a wider crypto winter in early 2026, even as the company has sought to diversify beyond pure spot trading into other asset classes and services.

Following the report, Coinbase’s stock traded lower in regular hours and slid further in after-hours trading, dipping under $184. The retreat comes as investors weigh not only quarterly performance but the company’s longer-term plan to navigate a market where trading activity has cooled and competition for revenue sources has intensified.

Coinbase’s quarterly challenges come as peers in the crypto ecosystem also grapple with slower revenue and tighter spreads, forcing many to reconfigure operations and human resources. The stock has fallen more than 14% this year, prompting a series of strategic adjustments designed to conserve cash and explore new growth avenues.

Looking ahead, Coinbase is pursuing a broader strategy to diversify beyond a single focus on spot crypto. Chief executive officer Brian Armstrong told investors that the world economy is moving on-chain, and Coinbase was built to capitalize on that transition. He framed the current period as an interim phase in which some asset classes outperformed while spot crypto assets lagged, with the expectation that diversification would eventually yield a more balanced trajectory over time.

That pivot toward a multi-asset platform aligns with a broader industry conversation about tokenized finance and adjacent revenue streams. In recent quarters, Coinbase has signaled interest in markets that extend beyond traditional spot trading, including prediction markets and other services that could complement trading activity. The company has also taken steps to constrain costs as part of a broader effort to return to a more sustainable earnings trajectory.

The market backdrop outside Coinbase has been mixed. Rival Robinhood Markets also reported softer-than-expected first-quarter results, with crypto revenue and trading volumes shrinking versus a year earlier. Industry analysts have suggested that the decline in crypto stocks presents a potential entry point for investors seeking exposure to the tokenization narrative, a view that Bernstein conveyed in March. The research firm argued that the downturn in crypto equities could be an opportunity to gain exposure to a broader shift toward tokenized finance — including stablecoins and prediction markets — that could gain traction in the coming years.

From a regulatory and adoption standpoint, Coinbase’s push to broaden product lines could help mitigate volatility tied to crypto price swings by generating revenue from non-trading services. The company also faces ongoing scrutiny around exchange operations, user protection, and the regulatory clarity required to support a more expansive suite of financial products tied to digital assets. Investors will be watching closely how new business lines perform and whether they can scale in a market where trading activity remains uneven and capital costs have risen.

In a quarterly filing that accompanied the earnings, Coinbase reaffirmed the numbers and provided the formal context for these results. The company’s Q1 2026 10-Q lays out the period’s performance and offers a window into the balance sheet, cash burn, and the company’s ongoing cost-control initiatives. For those seeking to review the official documentation, the filing is available here: Coinbase Q1 2026 10-Q.

As Coinbase navigates these headwinds, investors will be looking for concrete signs that the company can translate its strategic ambitions into tangible revenue streams. The first-quarter miss highlights the gap between the pace of strategic diversification and the immediate earnings trajectory that investors have grown accustomed to in a year of crypto market volatility. The company’s leadership will need to demonstrate that the contemplated shift toward a multi-asset platform can begin to offset declines in core trading activity, particularly if market conditions remain challenging in the near term.

Analysts’ take on the quarter remained mixed, with some noting the difficulty of beating revenue expectations in a slowing market. The Q1 2026 results also come after a period during which Coinbase announced cost-reduction measures, including workforce reductions, to align its cost structure with a slower revenue environment. The company disclosed that it laid off approximately 14% of its workforce, roughly 700 employees, as part of an ongoing effort to protect margin during a period of slower top-line growth.

For now, the path forward hinges not only on market conditions but on execution across new product lines and services. Armstrong’s message to investors — that the on-chain economy will continue to expand and that Coinbase was built to participate in that expansion — remains the north star for the company. The question for investors is whether the diversified approach will translate into a sustainable uplift in revenue and profitability as the broader crypto cycle evolves.

Looking ahead, readers should monitor Coinbase’s progress on cost discipline, the performance of new business initiatives, and how the company hedges against ongoing volatility in crypto markets. As the sector recalibrates, Coinbase’s ability to monetize non-trading activities and scale new products could determine whether the stock can weather the current downturn and participate in a future upswing as tokenization and on-chain finance gain broader traction.

Key takeaways

• Q1 2026 results show a $394.1 million net loss for Coinbase, extending a loss streak from Q4 2025, with revenue of $1.41 billion versus roughly $1.50 billion expected.
• Analysts anticipated earnings per share of 36 cents, but Coinbase reported a loss of $1.49 per share, contributing to a subdued reaction in after-hours trading and a stock price below $184.
• Macro headwinds were cited as a major factor, with total crypto market capitalization and trading volume down more than 20% quarter over quarter.
• Cost-cutting and strategic diversification are central to Coinbase’s plan, including layoffs of about 700 employees (roughly 14% of the workforce) and pivoting toward multi-asset offerings and services beyond spot trading.
• Industry context suggests mixed signals: peers like Robinhood also reported softer results, while analysts at Bernstein argued the downturn may create opportunities to tap into tokenization themes and a broader on-chain economy.

Q1 results and the market backdrop

Coinbase’s first-quarter performance arrived amid a crypto market backdrop that has yet to regain its footing. The company’s CFO underscored the macro challenges during the earnings call, reiterating that a meaningful portion of the revenue softness stemmed from a broad decline in crypto activity. The revenue miss was not just a function of weaker trading volumes but also a softer contribution from non-trading lines, illustrating the difficulty of maintaining profit margins when core activity contracts.

Despite the disappointing quarter, Coinbase’s leadership emphasized a strategic shift toward a broader asset-classes approach. Armstrong framed the current period as a phase where the ecosystem is evolving, with spot crypto assets lagging while other assets may contribute more meaningfully to the platform’s revenue mix over time. This multi-asset strategy, if executed effectively, could reduce sensitivity to price swings in the underlying crypto market and create a more resilient business model.

Moving beyond spot: diversification as a growth lever

The push to diversify aligns Coinbase with a broader industry thesis that tokenized finance and on-chain services will become a core driver of value creation. In the near term, the company is testing and expanding into new product areas that could complement trading activity and broaden the addressable market. Such a transition is not guaranteed to bear fruit quickly, but it represents an important strategic hedge against persistent volatility in spot markets.

At the same time, cost discipline remains a practical necessity. The decision to trim the workforce is a blunt acknowledgment that growth in an uncertain macro environment requires tighter expense management. Investors will want to see if these reductions translate into improved unit economics and whether the company can fund its expansion into new lines without compromising risk controls or user experience.

What to watch next

As Coinbase charts its path through 2026, investors should monitor several key developments: the performance of non-trading revenue streams, the pace and impact of ongoing cost initiatives, regulatory developments that could unlock or constrain on-chain products, and the degree to which the broader market recovers and supports trading volumes. The company’s quarterly progress on its multi-asset strategy will be particularly telling, as this plan represents both an opportunity to stabilize revenue and a test of management’s ability to execute beyond the traditional exchange model.

In case readers want to review the formal quarterly documentation, Coinbase’s Q1 2026 filing is accessible here: Q1 2026 10-Q.

Further context on the quarter’s expectations and peer performance can be found in market coverage surrounding Robinhood’s comparable results and Bernstein’s commentary on crypto equities and tokenization themes. These perspectives underscore a sector-wide pivot toward new revenue engines even as traditional trading volumes remain volatile.

Overall, Coinbase’s Q1 2026 results crystallize a transitional moment for the company and the crypto ecosystem: a time of deliberate restructuring and strategic experimentation, set against a backdrop of ongoing market headwinds and regulatory evolution. How quickly the new growth pillars can scale will shape the trajectory of Coinbase’s earnings power in the quarters ahead.

What remains uncertain is how smoothly the new initiatives will integrate with the existing platform and whether investors will see a clear path to profitability as macro conditions evolve. For now, the market will watch closely for signals that the diversification strategy is gaining traction and that cost controls are translating into measurable improvements in margins.

Coinbase shares slid Thursday after the US crypto exchange reported a steep first-quarter loss while revenue missed Wall Street expectations.

Coinbase reported a net loss of $394.1 million in Q1, its second consecutive quarterly loss after reporting a $667 million loss in Q4 2025. It swung from a $65.6 million profit a year earlier. 

“Macro conditions were genuinely tough,” Coinbase chief financial officer Alesia Haas told investors on an earnings call. “Total crypto market cap and total crypto trading volume were both down more than 20% quarter-over-quarter.”

Coinbase’s earnings come as other crypto companies have also struggled to turn a profit in the first months of 2026 as a crypto market slump pushed some traders to other investments.

Meanwhile, Coinbase’s Q1 revenue was $1.41 billion, missing analyst estimates of $1.5 billion. Transaction revenue slumped 40%, while subscription and services revenue — representing its business outside trading — fell 13.5% from a year earlier. 

Its earnings per share were a $1.49 loss, compared to analysts’ expectations of 36 cents per share, which saw Coinbase dropping by 4.7% after hours on Thursday to under $184.

Coinbase shares fell in regular and after-hours trading on Thursday amid the company’s first-quarter earnings. Source: Google Finance

Coinbase’s stock has fallen more than 14.5% this year, prompting the exchange to pursue new business lines such as prediction markets and cost-cutting measures, including laying off 14% of its workforce, or about 700 employees, on Monday.

Despite the company’s earnings, CEO Brian Armstrong struck an optimistic tone on the earnings call, telling investors that “the world economy is moving on-chain, and Coinbase was built to capitalize on this transition.”

He added that over the past year, Coinbase has aimed to transition from “a primarily spot-focused crypto platform into a place where you can now trade any asset class.”

“We’re in kind of this interim period where spot crypto assets were down a bit, other asset classes were up. As we diversify, these things will get balanced out, where we’ll just be in a more upward channel over time,” Armstrong added.

Related: Block Inc rises 8% as Q1 gives ‘earnings surprise’ despite Bitcoin dip

Coinbase rival Robinhood Markets also missed estimates for the first quarter last month as its crypto revenue and trading volumes nearly halved from a year earlier.

Bernstein said in March that the decline in crypto stocks presented a more attractive entry point for investors seeking exposure to the current hot theme of tokenization and maintained a bullish rating on Coinbase and Robinhood.

It argued that the companies offered investors exposure to a broader shift toward tokenized finance, including stablecoins and prediction markets, which it expected to gain traction in the coming years.

Magazine: Guide to the top and emerging global crypto hubs — Mid-2026

American Bitcoin posted an $81.8 million net loss in Q1 2026, even as the Trump-backed miner set a new quarterly production record of 817 BTC and cut its mining cost by 23%.

American Bitcoin reported a net loss of $81.8 million in Q1 2026, driven by a 22% bitcoin price decline that triggered a $117.2 million non-cash impairment on its digital asset holdings. Revenue from mining fell to $62.1 million from $78.3 million in the prior quarter.

Despite the headline loss, CEO Mike Ho pushed back. “Strip out the non-cash mark-to-market adjustment on our Bitcoin required by FASB,” he said, “and the underlying business was profitable and we did not sell a single coin.”

Gross mining margins held above 50% and the cost per coin fell to $36,200, a 23% improvement from $46,900 in Q4 2025.

Record production, widening paper losses

American Bitcoin mined 817 BTC in Q1, its highest quarterly output to date, and purchased an additional 803 BTC for its treasury. Total holdings reached 7,021 BTC as of March 31. Co-founder Eric Trump told Consensus Miami on Wednesday:

“In just over eight months as a public company, we have become the 16th largest bitcoin holder globally and scaled to more than 28 exahash of capacity.”

The company completed the deployment of 11,298 new Bitmain miners in early March, bringing its total fleet to 89,242 machines and 28.1 EH/s of capacity. Operating expenses for the quarter totalled $150.7 million.

ABTC shares fell roughly 7% in pre-market trading after the results missed analyst estimates by 17%. As crypto.news reported, ABTC debuted on Nasdaq through a reverse merger in September 2025, briefly pushing Eric Trump’s paper stake into billionaire territory before a sustained selloff.