31/08/2024
This TOP10 Crypto Exchange's Revenue Collapsed by Over 70% in One Year: After a
record-breaking 2021, one of Europe's oldest cryptocurrency exchanges
experienced two consecutive years of significant unprofitability. The British
branch of Luxembourg-based Bitstamp recently published its 2023 results,
showing a revenue decline to just under €8 million and a net loss of €19.7
million.
Bitstamp Endures
Challenging Two Years of Crypto Winter
Bitstamp
Limited, registered in the UK, emphasized in its report published this week in
Companies House that the 70% year-over-year revenue drop from €29 million was
"mainly driven by unfavorable market conditions and the reduction in
trading volumes."
In 2021,
the exchange achieved a record profit of €37 million, responding to Bitcoin's
historic highs. 2022 brought a decline from the peaks and a loss of around €7
million, while the past year saw this loss triple to nearly €20 million.
Nevertheless,
Bitstamp remains among the top 10 largest cryptocurrency exchanges in terms of
spot volumes. According to Finance Magnates Intelligence data, in July
2024, it ranked ninth with a result of almost $8 billion.
It's worth
noting that the unfavorable impact on results was not only due to lower BTC
prices throughout most of 2023 and reduced retail investor activity but also
internal company movements. Part of Bitstamp Limited's business was transferred
to three of its subsidiary companies, including Bitstamp UK Limited, Bitstamp
Global Ltd (registered in the British Virgin Islands), and Bitstamp Europe SA
(registered in Luxembourg).
Although we
don't have insight into the latter two's results, Bitstamp UK Limited also published its 2023 report. The company's turnover was not
substantial either, amounting to £1 million, with a net loss of £1.5 million.
Returning
to Bitstamp Limited, besides a significant decrease in revenue and deepening
net loss, the company also reported more than a twofold reduction in volume. In
2022, it amounted to €55 million, now falling to just over €25 million.
Although
the company doesn't mention any forecasts for 2024 in the report, looking at
how the BTC price has changed, it can be assumed that the current year will
perform significantly better compared to recent ones. Especially considering
that in 2023 the average Bitcoin price was $16,000, while currently, it's
around $44,000.
MiCA and Acquisition by
Robinhood
The
European Union's Markets in Crypto-Assets Regulation (MiCA) came into effect on
June 30. Bitstamp was one of the first exchanges to implement appropriate
measures before this deadline. The exchange delisted the EUR-denominated
stablecoin EURT and announced it would not list any new Electronic Money Tokens
(EMTs).
More
importantly, Robinhood announced in June its agreement to acquire Bitstamp. The
acquisition is expected to expedite Robinhood Crypto's global expansion.
Bitstamp holds over 50 active licenses and registrations worldwide, attracting
customers from the EU, UK, US, and Asia to Robinhood's platform.
We’re accelerating Robinhood Crypto’s worldwide expansion. Robinhood has officially entered into an agreement to acquire , a global cryptocurrency exchange with customers across the EU, UK, US and Asia. More details: https://t.co/wk3x02z0rU pic.twitter.com/aadKzhCxlx— Robinhood () June 6, 2024
"Bringing
Bitstamp's platform and expertise into Robinhood's ecosystem will give users an
enhanced trading experience with a continuing commitment to compliance,
security, and customer-centricity," said JB Graftieaux, CEO of Bitstamp.
This article was written by Damian Chmiel at www.financemagnates.com.
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