The first quarter of 2025 proved to be a turbulent period for major cryptocurrency exchanges, with market volatility and macroeconomic pressures weighing heavily on performance. Coinbase, the leading U.S.-based crypto platform, reported a significant drop in both revenue and net income. Despite these setbacks, one digital asset stood out in a remarkable way—XRP.
While Bitcoin declined 11% and overall trading activity slowed, XRP surged 458% in value on Coinbase over the past year, outperforming even Ethereum and Solana in terms of transaction revenue generation. This unexpected bright spot offers valuable insights into shifting investor sentiment and the growing resilience of certain altcoins in uncertain markets.
Coinbase Faces Headwinds in Q1 2025
Coinbase’s latest financial results reveal a challenging start to the year. Retail crypto trading volume fell 17% year-over-year, dropping to $78 billion in the first quarter. This decline directly impacted the exchange’s top-line performance, with total revenue decreasing by 10% to $2 billion compared to the same period in 2024.
More concerning was the sharp drop in net income, which plummeted 94% to just $66 million. A major contributor to this decline was nearly **$600 million in unrealized losses** on the company’s cryptocurrency holdings—highlighting how sensitive exchange profitability is to market swings.
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Even tech stocks broadly took a hit, and Coinbase shares dipped 6% following the earnings release. Yet, within this broader downturn, one asset category defied expectations: XRP.
XRP Emerges as a Top Performer
Despite the overall bearish tone, XRP generated more transaction revenue for Coinbase than both Ethereum and Solana during the quarter. According to SEC filings, XRP accounted for 18% of consumer trading revenue, nearly matching the combined contribution of the two larger blockchains.
This performance is particularly impressive considering that Coinbase had suspended XRP trading for two years—from late 2021 until July 2023—due to regulatory uncertainty surrounding Ripple Labs. The relisting followed a pivotal court ruling that determined Ripple’s sale of XRP through exchanges did not constitute an unregistered securities offering.
Since then, investor interest has rebounded strongly. The value of XRP held on Coinbase skyrocketed by 458% over the last 12 months, signaling renewed confidence in the asset’s utility and long-term potential.
Moreover, XRP saw the largest year-over-year increase in crypto deposits on the platform, outpacing many other major digital assets. While Bitcoin and Ethereum still dominate Coinbase’s overall crypto reserves—with BTC holdings rising 35% and ETH valued at $250 million—the momentum behind XRP cannot be ignored.
Why XRP’s Resurgence Matters
The resurgence of XRP reflects more than just speculative trading activity. It underscores growing optimism around Ripple’s expanding use cases in cross-border payments, institutional adoption, and clearer regulatory clarity post-litigation.
Investors appear to be rewarding assets with real-world utility and legal resolution—two factors that now favor XRP after years of uncertainty. In contrast, even high-performing ecosystems like Ethereum and Solana faced headwinds from declining DeFi activity and reduced retail participation.
For Coinbase, the strong showing from XRP-related transactions provides a strategic data point: demand for compliant, utility-driven altcoins remains robust, even during market downturns.
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Broader Market Challenges Affect All Players
Coinbase wasn’t alone in facing a tough quarter. The entire crypto sector felt the pressure from global financial instability, partly triggered by aggressive trade policy shifts earlier in the year. Robinhood, another key player in retail crypto trading, also reported declining revenues as trading volume dropped from $71 billion at the end of 2024 to $46 billion in Q1 2025.
Like Coinbase, Robinhood had enjoyed a surge in late 2024 following heightened market excitement post-election. However, CEO Vlad Tenev recently acknowledged that crypto’s extreme volatility necessitates diversification, prompting plans to expand beyond digital assets.
This trend suggests that while crypto remains a core growth driver, platforms must build resilience through diversified offerings—a lesson equally applicable to exchanges and investors alike.
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- XRP
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- Crypto deposits
- Market volatility
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Frequently Asked Questions (FAQ)
Q: Why did XRP perform so well on Coinbase despite overall market declines?
A: XRP's surge followed its relisting after a favorable court ruling on its regulatory status. Combined with Ripple’s real-world payment applications, this restored investor confidence and drove increased trading and deposit activity.
Q: Did Coinbase make more money from XRP than from Ethereum?
A: Yes—XRP generated more transaction revenue than Ethereum or Solana individually during Q1 2025, contributing 18% of total consumer trading revenue.
Q: Was XRP ever delisted from Coinbase?
A: Yes. Coinbase suspended XRP trading in December 2021 due to an SEC lawsuit against Ripple. Trading resumed in July 2023 after a court ruled that XRP sales on exchanges did not violate securities laws.
Q: How much did Coinbase’s net income drop in Q1 2025?
A: Net income fell 94% year-over-year to $66 million, largely due to $600 million in unrealized losses on its crypto holdings.
Q: What role does regulation play in XRP’s price movement?
A: Regulatory clarity significantly impacts investor sentiment. The 2023 court decision reduced legal uncertainty, paving the way for exchanges to relist XRP and institutions to reconsider exposure.
Q: Is XRP considered a good investment now?
A: Many analysts view XRP favorably due to its utility in cross-border payments and improved regulatory standing. However, as with all cryptocurrencies, it carries risk and should be evaluated within a diversified portfolio.
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Final Thoughts
While Coinbase navigated a rough start to 2025, the standout performance of XRP offers a compelling narrative about resilience, regulatory resolution, and shifting market priorities. As investors increasingly favor assets with clear use cases and legal foundations, XRP’s resurgence may signal a broader trend toward mature, utility-focused digital currencies.
For traders and long-term holders alike, monitoring platforms like Coinbase for transaction volume and deposit trends can provide early signals of momentum shifts—especially in altcoins that are quietly gaining ground amid the noise.