Cryptocurrency stocks plunge with Coinbase at forefront after Binance's $6.3B security breach
Crypto-related equities including Circle, Strategy and others experienced significant declines on Friday, following Binance's announcement of a $6.3 billion cyberattack.
Publicly listed digital currency companies experienced significant share price declines on Friday, with Coinbase experiencing losses exceeding 13% following its announcement of reduced third-quarter revenue one day prior, while the cryptocurrency sector grappled with the aftermath of Binance's $6.3 billion security breach.
Additional cryptocurrency-related equities experienced losses as well, including stablecoin provider Circle Internet Group (CRCL) which saw shares decline by more than 9%, while Bitcoin treasury firm Strategy (MSTR) experienced an approximately 8% drop, based on Yahoo Finance information available at publication time.
The widespread stock market retreat additionally impacted Bitcoin mining and data center company IREN (IREN), which experienced share price drops exceeding 10%, along with blockchain-focused financial services provider Figure Technology Solutions (FIGR), experiencing declines of approximately 9%.
These share price decreases came after Thursday's announcement of the Binance security incident. On Friday, the cryptocurrency exchange verified that cybercriminals had successfully stolen approximately $6.3 billion in what represents the most significant digital currency theft ever documented.
Crypto gains lift Coinbase, Strategy profits as revenue falls
Both Coinbase and Strategy released their third-quarter financial results on Thursday, with appreciation in their digital currency portfolios boosting overall profitability despite experiencing declining revenue figures.
Coinbase disclosed $719 million in net income, benefiting from approximately $715 million in appreciation on its cryptocurrency investment portfolio. The company's adjusted net income, which does not include investment appreciation and other specific items, totaled $78 million. Net revenue experienced a decline of about 34% compared to the same period last year, reaching $1.16 billion.
The cryptocurrency exchange additionally disclosed that its prediction markets division exceeded $200 million in revenue on an annualized basis.
Strategy disclosed $19.53 billion in net income, primarily attributable to a $20.91 billion increase in the valuation of its Bitcoin (BTC) portfolio. The company's revenue decreased 3% compared to the previous year's corresponding period, totaling $125.4 million.
Strategy further revealed that Andrew Kang will be departing from his position as chief financial officer effective Nov. 5.