Coinbase Says Revenue From Its Base Layer 2 Fell Despite Record Volume

Coinbase says Base is processing more stablecoin volume than any other blockchain — and the company is earning less from the network each quarter.

In its second-quarter earnings presentation filed Thursday, the exchange said "other" transaction revenue fell 11% quarter-over-quarter to $47.4 million, "largely driven by lower Base revenue," even as stablecoin transaction volume on Base grew seven times year-over-year.

The disclosure lands in the middle of the question hanging over every Ethereum L2: whether networks that compete on sub-cent fees can turn scale into revenue. Coinbase is engineering the trade-off deliberately, touting sub-cent, sub-one-second settlement as a product goal in the same deck.

Scale Without Fees

The bucket that contains Base sequencer fees has shrunk from $68 million in Q3 2025 to $47.4 million last quarter. Over the same stretch, CEO Brian Armstrong said on Thursday's earnings call, Base processed "about ... 32 trillion in the last 12 months of stablecoin transfer volume," making it "number 1 now in terms of stablecoin volume" among all chains.

Coinbase also said more than 90% of agentic stablecoin transactions — payments initiated by AI agents, largely via its x402 protocol — settle on Base.

For Coinbase, the trade-off is deliberate: Base drives users toward USDC, where the economics are far larger. The company said it has captured roughly 50% of all USDC economics over the past year, and stablecoin revenue of $292.1 million was nearly half the size of its entire transaction revenue line in Q2.

But even stablecoin revenue couldn’t lift results above analyst expectations. Revenue of $1.22 billion missed estimates, the company posted a $359.5 million net loss — its third straight — and COIN fell about 5% in after-hours trading. Coinbase also stopped disclosing trading volume as a key metric this quarter, pointing instead to a record 10.3% share of global crypto trading volume.

No Base Token

The results gave no comfort to anyone waiting on a Base token: the word appears nowhere in the earnings deck, the 10-Q, or the call. Armstrong instead repeated that there is "a path to decentralize it over time ... through the different stages of decentralization," and claimed a "2-year head start" over newer entrants such as Robinhood's and Stripe's L2s.

He also floated a novel idea about where the L2 race ends: consolidation. "The question is, how and when will that consolidation phase happen? And how might there be sort of an M&A-type process in the world of blockchains?" Armstrong said. "We might have to become a bit of a specialist in that area."

Armstrong confirmed that Jordan Fish, the crypto-native investor and podcaster known as Cobie, has joined to run the Base app — "he comes from that community, which is really good."

DeFi-Powered Borrow/Lend

The quarter's other under-the-radar DeFi number: average borrow and lend balances in the Coinbase app hit a record $1.49 billion, up from $199 million a year ago. Those balances, the company notes, are “powered by onchain DeFi protocols” accessible in the app, chiefly Morpho on Base.

Coinbase also reported more than $5 billion in cb-wrapped assets, including cbBTC and cbETH, and its product roadmap lists a retail DEX, expanded DeFi borrowing and lending, and crypto-backed mortgages.

Coinbase's own ETH position was flat at 150,279 ETH held for investment, per the 10-Q, carried at $235.7 million against a $340.6 million cost basis. Meanwhile, it added roughly 1,900 BTC in the f

Staking revenue fell 42% year-over-year to $83.3 million, the lowest quarterly figure in the more than three years of data Coinbase disclosed, on lower Solana and Ethereum prices and reward rates.