During a recent appearance on CNBC’s Squawk Box, John D’Agostino, Head of Institutional Strategy at Coinbase, addressed the skepticism surrounding the current downturn in cryptocurrency prices, particularly focusing on Bitcoin. Despite posting a quarterly revenue of $1.41 billion—a 30% decline year-over-year—Coinbase managed to maintain its reputation for profitability, achieving its 13th consecutive quarter of positive adjusted EBITDA.
D’Agostino argued that Bitcoin has demonstrated resilience through six substantial cycles over the past 15 years, adapting each time to emerge with new all-time highs after temporary downturns. He noted that this historical behavior indicates that the current dip is likely a repetition of previous patterns, where retail panic tends to drive down prices before a recovery takes hold.
He pointed out that Bitcoin currently trades at approximately 2.5 times the point where bearish critics declared victory in previous market cycles. D’Agostino advised investors who purchased at recent peaks to exhibit patience, as previous cycles show that those who panic-sell during lows often miss out on subsequent gains.
Further reinforcing his arguments, D’Agostino likened Bitcoin to gold, emphasizing its characteristics as a form of money—scarcity, durability, portability, verifiability, and acceptance—rather than assessing it through conventional financial models tied to cash flow. He believes this distinction explains why typical equity price targets fail to appropriately evaluate Bitcoin’s value.
Highlighting the increasing mainstream acceptance of Bitcoin, D’Agostino shared several key examples of its growing adoption. He mentioned Coinbase’s facilitation of the first stablecoin-based payment for independent journalists, which notably shortened settlement times from 90 days to just one day. Additionally, he claimed that over 40 countries have committed to acquiring Bitcoin to some extent for their national balance sheets, suggesting a growing institutional interest.
It’s worth noting that Coinbase, regarded as a primary barometer for cryptocurrency activities in the US, reported a GAAP loss of $1.49 per share, primarily attributing this loss to significant declines on cryptocurrency held for investment. The company remains proactive in reducing expenses, announcing a 14% reduction in its workforce, with a target of achieving around $500 million in annualized savings. Despite these challenges, Coinbase retains a robust cash position of $10.2 billion.
CEO Brian Armstrong reinforced the cyclical nature of crypto markets, stating, “Crypto is cyclical, and experience tells us it’s never as good, or as bad as it seems.” The ultimate test of D’Agostino’s thesis will be whether Bitcoin can maintain its long-term upward trajectory. Investors will be closely monitoring developments in stablecoin adoption, sovereign and institutional demand, as well as growth in Coinbase’s subscription services—all vital indicators of the crypto ecosystem’s evolution beyond its historical boom-and-bust cycles.
