Coinbase Global, Inc.

Good afternoon, my name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the Coinbase first quarter 2024 earnings call. All lines have been placed on mute to prevent any background noise. After the prepared remarks, there will be a question and answer session, and if you would like to ask a question during this time, please press star 1 on your telephone keypad. If you wish to withdraw your question, simply press star 1 again. Anil Gupta, Vice President, Investor Relations. You may begin your conference.

Good afternoon and welcome to the Coinbase First Quarter 2024 Earnings Call. Joining me on today's call are Brian Armstrong, Co-Founder and CEO, Emily Choi, President and COO, Alicia Haas, CFO, and Paul Graywall, Chief Legal Officer. I hope you've all had the opportunity to read our shareholder letter, which was published on our Investor Relations website earlier today. Before we get started, I'd like to remind you that during today's call, we may make forward-looking statements. Actual results may vary materially from today's statements. Information concerning risks, uncertainties, and other factors that could cause these results to differ is included in our SEC filings. Our discussion today will also include references to certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are provided in the shareholder letter on our Investor Relations website. Non-GAAP financial measures should be considered in addition to, not as a substitute for, GAAP measures. We are once again using the Say Technologies platform to enable our shareholders to ask questions. And in addition, we will take some live questions from our research analysts. With that, I'll turn it over to Brian for opening comments.

Thanks, Anil. Q1 was a very strong quarter. We generated more adjusted EBITDA than we did all of last year. Keeping our cost structure low while continuing to innovate is really paying off. To kick off today's call, I wanted to provide a progress update on the 2024 priorities that I shared on our Q4 call. As a refresher, they are first, driving revenue. We're doing this through improvements to our core simple trading experience, growth in stable coins, winning in the derivative space, both in the US and abroad, and driving international growth by investing in key markets. Second, we're driving utility in crypto. We're doing this through base, our low cost layer two solution, and building a better payments experience on crypto rails. And third, we're driving regulatory clarity. We're doing this through the courts, through collaboration with policymakers around the world to pass sensible rules, and most importantly, through activating the crypto voter base to elect pro-crypto candidates in this upcoming election. Let's start with driving revenue. In Q1, we capitalized on strong market conditions, and we saw many of our investments through this last downturn begin to pay off. Our institutional business continued to see meaningful growth, in part driven by the excitement around Bitcoin ETFs which drove new customer adoption across our product suite. Coinbase Prime reached all-time highs in trading volume and active clients, and nearly 40% of our clients engaged with three or more products in Q1. Turning to derivatives, both Coinbase Financial Markets and Coinbase International Exchange have shown promising growth in their early stages. In Q1, Coinbase International Exchange added 15 new perpetual future listings. We've also increased the position limits across both products. USDC market cap increased over 30% year to date and is growing faster than major competitors. We see higher engagement from customers who hold USDC balances on our platform. So we've been investing in rolling those platforms balances by unifying order books on advanced trading and offering competitive rewards. And while it's still early days, we're also seeing great traction with Coinbase One, our consumer subscription product, which surpassed 400,000 paid subscribers in Q1. Next, let's move on to utility. I'd like to spotlight our Layer 2 solution, BASE. As a reminder, Layer 2 solutions help blockchains scale, similar to when the internet moved from dial-up to broadband. And we believe this scaling will drive many new use cases in the crypto economy. BASE has helped dramatically reduce transaction fees and confirmation times, getting us closer to our goal of having the average crypto transaction take less than one second and cost less than one cent anywhere in the world. Developer activity on BASE increased eightfold in Q1. In the last 30 days, BASE has processed over two times as many transactions as the entire Ethereum network on layer one. BASE is now the number one layer two solution by number of transactions processed, a huge accomplishment. We've made BASE faster and cheaper to use with fee reduction by about 80% through protocol upgrades, and our fees are now often below one cent. We're also integrating USDC on BASE across QueenBase products creating nearly free instant global payments in a USD denominated asset. This is a really, really big deal as we now have direct line of sight to update the global financial system by reducing the billions in payment fees paid by consumers and businesses each year. Finally, let's discuss regulatory clarity. Coinbase continues to invest heavily in driving clear rules and regulations around the world for crypto, and we're actively contributing to advancing pro-crypto candidates during this major election year. We're a large contributor to pro-crypto organizations like Fairshake, SuperPAC, which already had a great impact in the March primaries in California, Texas, and Alabama. We also continue to work with grassroots advocacy organizations like StandWithCrypto.org, which now has over 400,000 crypto advocates who've raised their hand indicating they want to elect pro-crypto candidates in November. We're also making steady progress in getting clarity through the courts in our litigation with the SEC. In Q1, the court ruled on our motion to dismiss, dismissing the SEC's claim regarding Coinbase Wallet, which was a significant win for self-custodial wallets across the industry. This win provided clarity for us and developers to continue to drive our on-chain product growth, which we believe is an important element to fulfilling our mission of increasing economic freedom. The court denied the rest of the motion at this very early stage, meaning the rest of our case is proceeding to discovery. but we're fully prepared for an intensive discovery phase through the remainder of the year and remain confident in the strength of our legal arguments. 2024 is shaping up to be an important growth year for our industry and for our mission. Now, I'll pass it over to Alicia, who will provide detailed insights into our financials.