Coinbase Q1 '26 Earnings: A conversation with Coinbase Chief Business Officer Shan Aggarwal

Well, congratulations on a big day today. Just getting familiarized with the latest earnings release, but there are a lot of interesting notes to dive in. Before we go into specifics, I'm just kind of curious, you know, what's your summary for how Coinbase is operating at the moment and any highlights from the last quarter that really jumped out to you? Yeah.

So overall, soft market conditions in Q1, which I don't think are a surprise for anybody, but we executed well and delivered on the things within our control. So first, we reached an all-time high in crypto trading volume market share, which has uh shown steady growth over the past few years. Uh, second, Coinbase is the largest regulated stablecoin platform in the world. And uh we continue to grow USDC held on Coinbase, which reached an all-time high of $19 billion.

We monetize that through our commercial arrangement with Circle, where we capture around 50% of the total economics from USDC. And then third, I'm really excited about the green shoots that we saw on the everything exchange, in particular with retail derivatives and prediction markets showing strong growth just a few months after launching. You know, it's interesting. I think to most consumers, Coinbase is synonymous with retail crypto trading.

But if you look at the core dynamics that are driving business growth today, it looks like a lot of institutional and B2B products. Do you see those being a bigger component of Coinbase's overall strategy this year? We've continued to invest in the institutional and developer business. The way that we think about it is that they're very synergistic with the consumer side of our business.

And what I mean by that is as we look to grow our retail derivatives platform and initiatives, as we attract more retail customers, that draws institutions that want to access that marketplace, deepens liquidity on our derivatives exchanges. And so we're really trying to serve both sides of the market. Specifically, I think within stable coins and payments, we are seeing very strong growth and demand from corporations, enterprises, et cetera, for more efficient money movement.

And so our platform there is more oriented towards businesses. And I do think that it will continue to play a more meaningful role in Coinbase's overall story. I'd also love to dive into the latest updates with the everything exchange focus. Now I know that this terminology came out from Coinbase a couple quarters ago and alludes to the fact that the distinction between digital currency assets or crypto assets and traditional equities and brokerage assets is starting to collapse.

How's that playing out at Coinbase? Yeah, we heard from our customers that they wanted to trade everything. And I think the trend that we see is that there's a convergence between traditional assets and crypto assets, where all of these assets will ultimately be tokenized and held on-chain. And so with the everything exchange, we are looking to make uh it possible for our customers to trade across every asset class with deep liquidity and capital efficiency.

And I think the green issues that I mentioned, which we're seeing over the past quarter, validate our strategy in many ways, where we're starting to see very strong growth in retail derivatives, in prediction markets, in integrated DEX trading. We also added support for non-crypto features contracts, things like oil, silver, gold, and saw a very strong uptake in those products. So, you know, it's really exciting for us, and we feel it validates our strategy and we're excited to double down on it through the rest of 2026.

And are these products currently uh available to trade in tokenized format where they're not gated to exchange hours, or are they currently traded on kind of conventional exchanges and exchange hours? There's a mix. Massets are some asset classes are tokenized, other asset classes are uh offered on our centralized exchanges and uh and platforms. And we really think about this transition as uh where Coinbase serves as a bridge where assets exist off-chain, but we serve that demand, we serve those customers, and then we can offer tokenization services to bring those on-chain to benefit from global accessibility, 24-7 uh market hours, uh programmability, and all of the other benefits associated with blockchain infrastructure.

Timing a little bit here to focus on Coinbase's stablecoin business. I noticed that stablecoin transaction volume on your L2 base chain jumps 10x year over year. Really impressive growth. I'm curious what's driving that.

Yeah, we're very excited about the growth of stablecoins on base. And I think uh it's really speaks to the power of integrated DeFi experiences into Coinbase. One thing where we feel like we are a pioneer on is integrating BASE and other open financial protocols into our custodial uh Coinbase products and services that uh provides a sense of usability and utility to our customers. And the growth on BASE over the past quarter was really driven by two factors.

The first was uh increasing demand for stablecoin payments writ large, and a lot of that uh transaction volume was processed on base. And then the second piece is a stablecoin utility within DeFi, uh, and particularly on DEX is on base. And it would not be a 2026 earnings call if we didn't talk a little bit about AI and specifically agentic commerce. There is another call out in the data that um USDC on base accounted for about 90% of on-chain agentic commerce in the first quarter of this year using publicly available data from Artemis Analytics.

What does agentic commerce look like on base at the moment? Yeah, I think a lot of the adoption and early adoption is being driven by the early investments that we made in thinking about agents as new economic actors and new customers that are fundamentally different than consumers or institutions or the like. And so a year ago, we introduced the X402 protocol, an open source protocol to facilitate machine-to-machine payments. And we've started to see meaningful uptake in the X402 protocol.

And agents that are leveraging the X402 protocol for trading, for access to data subscriptions, for inference and for other uses are gravitating to USDC and base. And it's still very early days within this space, but it's an area that we're very focused on in ensuring that Coinbase remains an early pioneer and a leader. Well, there was so much more about the business to dig into the growth of Coinbase's prediction markets products, the uh growth of derivatives over time. But Sean, I know that we only have you for about a minute left.

So I'm curious, what bone of the business are you spending the most time on these days and what excites you the most about where you're focused in 2026? Really excited about the progress that we're making on the everything exchange. We introduced it as a new concept at our product showcase in December. And I think the early results are really starting to validate our strategy and give us a lot of confidence in the direction of travel there.

And we're getting great feedback from our customers. We think that it will enhance the depth of engagement on our platform. So there's a lot more that we can do as we look to expand our derivatives, prediction markets, equities, businesses, uh, and then ultimately bring all of those asset classes on chain. Well, I'm excited to see that.

We're marching slowly towards a tokenized future. Sean, thanks so much for spending time with us today.