(Bloomberg) -- In yet another example of how swiftly investor interest in crypto has dried up, Coinbase Global Inc.’s spot trading volume likely plummeted by more than half during the recently completed third quarter. 

The largest US digital-asset platform registered about $76 billion in spot trading volume, a drop of 52% from the year-ago period, according to data compiled by researcher CCData. The tally is also likely the least since before the company’s much ballyhooed direct listing on the Nasdaq Stock Market in April 2021, or just months before prices of cryptocurrencies peaked.  

Trading volume is a key metric for exchanges, with Coinbase deriving the biggest portion of its revenue from trading fees. In the second quarter, Coinbase said so-called transaction revenue accounted for 54% of total revenue. The decline is part of a year-long slide across the crypto industry following a spate of scandals, bankruptcies and regulatory actions. 

“Overall it looks like a challenging quarter” for Coinbase, said Owen Lau, an analyst at Oppenheimer & Co., who has a “market perform” rating on the company’s shares. 

Coinbase is forecast to post a seventh consecutive quarterly loss when it releases results on Nov. 2, according to analysts surveyed by Bloomberg. A Coinbase spokesperson didn’t return a request for comment.

Even with the decline, Coinbase likely gained market share in the quarter while industry leader Binance came under increased regulatory scrutiny. Coinbase’s percentage of overall spot trading volume likely rose to 5.7%, compared with 4.2% a year earlier, according to CCData. 

Mizuho Securities expects Coinbase’s trading volume to be below a consensus estimate of $86 billion, and revenue to be 10% below forecasts. The firm, which has an underperform rating on Coinbase, lowered it estimate for trading volume to $72 billion on Oct. 4, and doesn’t expect the current fourth-quarter to be much better, according to analyst Ryan Coyne.  

Trading volume is waning against a backdrop of regulatory issues for Coinbase. The company has been accused by the US Securities and Exchange Commission of running an illegal exchange, among other allegations. Coinbase is fighting the charges in court.      

Coinbase’s shares have more than double this year to around $80, after plunging 86% last year. The stock traded at more than $350 following its Nasdaq listing in early 2021.


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