(Reuters) -Coinbase Global beat second-quarter revenue expectations on Thursday as a surge in the crypto exchange’s interest income cushioned a slump in trading volumes, sending its share up 10% in extended trading.
The U.S. central bank has raised benchmark interest rates at a record pace since last year in a bid to tame iflation, allowing firms that lend money to customers to charge more on loans.
Coinbase earns interest on reserves backing USD Coin (USDC), the second-biggest stablecoin by market capitalization. It also earns interest on bitcoin-backed loans it provides to customers.
Interest income in the quarter surged to $201.4 million from $32.5 million a year ago, boosting revenue at the company’s subscription and services segment.
The revenue growth comes on the heels of a dramatic quarter for the company and its rival Binance who was sued by the U.S. Securities and Exchange Commission in June.
Coinbase’s revenue in the second quarter came in at $707.9 million, beating estimates of $662.5 million, according to Refinitiv data.
(Reporting by Manya Saini and Sri Hari N S in Bengaluru; Editing by Maju Samuel and Arun Koyyur)
