After a record-breaking 2021, one of Europe's oldest cryptocurrency exchanges experienced two consecutive years of significant unprofitability. The British branch of Luxembourg-based Bitstamp recently published its 2023 results, showing a revenue decline to just under €8 million and a net loss of €19.7 million.
Bitstamp Endures Challenging Two Years of Crypto Winter
Bitstamp Limited, registered in the UK, emphasized in its report published this week in Companies House that the 70% year-over-year revenue drop from €29 million was "mainly driven by unfavorable market conditions and the reduction in trading volumes."
In 2021, the exchange achieved a record profit of €37 million, responding to Bitcoin 's historic highs. 2022 brought a decline from the peaks and a loss of around €7 million, while the past year saw this loss triple to nearly €20 million.
Nevertheless, Bitstamp remains among the top 10 largest cryptocurrency exchanges in terms of spot volumes. According to Finance Magnates Intelligence data, in July 2024, it ranked ninth with a result of almost $8 billion.
It's worth noting that the unfavorable impact on results was not only due to lower BTC prices throughout most of 2023 and reduced retail investor activity but also internal company movements. Part of Bitstamp Limited's business was transferred to three of its subsidiary companies, including Bitstamp UK Limited, Bitstamp Global Ltd (registered in the British Virgin Islands), and Bitstamp Europe SA (registered in Luxembourg).
Although we don't have insight into the latter two's results, Bitstamp UK Limited also published its 2023 report. The company's turnover was not substantial either, amounting to £1 million, with a net loss of £1.5 million.
Returning to Bitstamp Limited, besides a significant decrease in revenue and deepening net loss, the company also reported more than a twofold reduction in volume. In 2022, it amounted to €55 million, now falling to just over €25 million.
Although the company doesn't mention any forecasts for 2024 in the report, looking at how the BTC price has changed, it can be assumed that the current year will perform significantly better compared to recent ones. Especially considering that in 2023 the average Bitcoin price was $16,000, while currently, it's around $44,000.
MiCA and Acquisition by Robinhood
The European Union's Markets in Crypto-Assets Regulation (MiCA) came into effect on June 30. Bitstamp was one of the first exchanges to implement appropriate measures before this deadline. The exchange delisted the EUR-denominated stablecoin EURT and announced it would not list any new Electronic Money Tokens (EMTs).
More importantly, Robinhood announced in June its agreement to acquire Bitstamp. The acquisition is expected to expedite Robinhood Crypto's global expansion. Bitstamp holds over 50 active licenses and registrations worldwide, attracting customers from the EU, UK, US, and Asia to Robinhood's platform.
"Bringing Bitstamp's platform and expertise into Robinhood's ecosystem will give users an enhanced trading experience with a continuing commitment to compliance, security, and customer-centricity," said JB Graftieaux, CEO of Bitstamp.
