CoinShares posts highest quarterly earnings since Q1 2022

May 17, 2023 Alex Rustok

Cryptocurrency investment group CoinShares recently published its Q1 earnings report for 2023 amid what it’s calling a “return to profitability.” 

Highlights of the report include revenue in the amount of $11.73 million (down from $22.46 million in Q1 2022), total comprehensive income of $3.62 million (down from $25.83 million in Q1 2022) and an adjusted earnings before interest, taxes, depreciation, and amortization (EBIDTA) of $10.61 million (down from $25.83 million in Q1 2022).

Overall, for 2022, CoinShares posted an operating loss of $25.21 million, in stark contrast to the company’s operating profit of $126.54 million reported for 2021.

Per the report, this comes after a tumultuous period for the company and the cryptocurrency industry as a whole:

In Q1 2023, as in 2022, the financial and crypto industries faced a challenging and complex landscape. Against this backdrop CoinShares demonstrated a powerful resilience. During the quarter we generated revenue and gains of £15.3 million and successfully returned to profitability, with Adjusted EBITDA of £8.5 million. This resulted in an Adjusted EBITDA margin of 55%.

The report cites the recent collapse of “crypto friendly banks such as Silvergate and Signature” and regulatory scrutiny surrounding FTX’s “dramatic decline” as mitigating factors for the earnings, indicating profits may have been diminished by the looming spectre of government oversight.

CoinShares appears cautiously optimistic going forward, stating that “we welcome this additional regulatory activity but hope it does not devolve into a witch hunt or become a consequence of crypto politicisation ahead of the U.S. elections, as some commentators have speculated.”

The earnings report comes directly on the heels of CoinShares’ “Digital Asset Fund Flows Report,” which, as Cointelegraph reported, revealed that digital asset investment products outflows totaled $54 million for the week, meaning that much was transferred from the exchange to wallets.

According to CoinShares, the recent trends toward outflows can at least be partially blamed on consumer and industry speculation related to U.S. federal interest rate hikes. As mentioned in a previous Cointelegraph report, such speculation may be a contributing factor to recent Bitcoin (BTC) volatility.