Brian Armstrong: We intend to receive 50% of income from subscriptions and services

The Coinbase CEO, facing losses and government harassment, is changing his profit model in favor of products that are resilient to market changes.

Brian Armstrong said in an interview that his trading platform, affected by the bearish trend in the cryptocurrency market, is cutting costs and changing its profit model. The CEO clarified that Coinbase intends to phase out trading fees as its main source of revenue as they only generate revenue during a bullish trend. Against the backdrop of bearish sentiment, cash flow in this direction is drying up:

“Today, we are investing a lot in subscription and service revenues. We understand that trading fees will still make up the majority of our business ten years from now, even twenty years from now, but I would like to see more than 50% of our revenue come from paid subscriptions and services.”

Armstrong added that currently 18% of Coinbase’s revenue comes from subscription services, specifically the staking service. As Coinbase moves away from trading fee income, Armstrong believes the company needs to move away from its US focus:

“Looking back, we see that perhaps too much attention was paid to the United States. This may be the most serious mistake made in the last couple of years. We intend to change the policy.”

Armstrong revealed that Coinbase, founded in 2012, has already gone through four bearish cycles. Therefore, he is not particularly concerned that the exchange laid off 18% of its staff at the beginning of the year and will be cutting costs to make up for losses that are expected over the next 12-18 months or longer. The CEO cannot yet claim that further layoffs will not follow:

“Never say never. Although the initial round of layoffs was intended to be a one-time event.”

Last week, the head of the Coinbase exchange announced that the exchange would stop participating in ETH staking if US regulators required to censor transactions.