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Coinbase to relocate from the US?
Fintech Headlines for April 18, 2023: Coinbase CEO floats the idea of relocating the company away from the United States, UK's Wise reports strong Fiscal Q4 2023 results, stock plummets anyways, and Goldman Sachs reports a $470 million loss on sale of Mar
Welcome to the “Popular Fintech” newsletter! Big banks kicked off the Q1 2023 earnings seasons, so expect a flurry of activity in the upcoming weeks. Today we are going to look into:
Coinbase CEO, Brian Armstrong, floating the idea of relocating the company away from the United States
UK’s payments company Wise posting strong Fiscal Q4 2023 results just to see its stock plummet
Goldman Sachs reporting a $470 million loss on the sale of Marcus loans, as the company continues to retrench from consumer finance
1D change as of April 18, 2022 close
Coinbase CEO Floats the Idea of Relocating the Company Away from the United States
Coinbase (NASDAQ: COIN) CEO Brian Armstrong has said that he would not rule out relocating the company away from the United States if the regulatory environment for cryptocurrencies does not improve. Speaking at a Fintech conference in London, Armstrong said that he was concerned about the lack of regulatory clarity in the US and the impact it was having on the company's ability to operate. He added that the company was considering all options, including moving its headquarters to a jurisdiction with a more favorable regulatory framework. Armstrong's comments come as Coinbase continues to face regulatory scrutiny from the SEC. Last month, Coinbase received a formal notice from the agency regarding the regulator's intention to take enforcement action against the company.
Image source: Steve Jurvetson on Flickr
✔️ Coinbase CEO Won’t Rule Out Relocating Company Away From US
✔️ Coinbase CEO says the crypto exchange is preparing to go to court with the U.S. SEC
✔️ Republicans Pummel SEC’s Gary Gensler Over Crypto Crackdown
Wise Reports Strong Fiscal Q4 2023 Results, Stock Plummets Anyways
Wise (LON: WISE) the UK-based money transfer service, released a trading update for Fiscal Q4 2023 (the company’s fiscal year ends on March 31) showing strong growth in revenue. The company reported a 43% YoY increase in revenue and an 83% YoY increase in total income, driven by growth across all its segments, including personal and business customers. Wise’s 6.2 million active users moved £26.7 billion in cross-border volume during the quarter, which represents a 25% YoY increase, and held £10.7 billion of their money with the company. However, the company’s earnings fell short of market expectations due to a drop in cross-border transfers. The shares price was down 7.76% for the day. Despite the setback, Wise remains committed to its mission of “moving and managing money faster, easier, cheaper and more transparent for people and businesses around the world.”
Data source: Wise Investor Relations
Goldman Sachs Reports $470 Million Loss on Sale of Marcus Loans
Goldman Sachs (NYSE: GS) posted its first-quarter results on Tuesday that fell short of analysts’ expectations due to weaker trading results and a $470 million hit linked to the sale of consumer loans. Thus, the bank sold a $4 billion portion of its Marcus loan book and transferred the remainder to held-for-sale status. The bank is also taking steps to further retrench from retail finance, as initiated selling its GreenSky unit that it acquired in late 2021. The news came just a day after Apple launched new savings accounts with Goldman Sachs acting as its financial partner. CEO David Solomon commented on Apple's new savings account during the earnings call, stating that he is not concerned about the competition, but is closely monitoring for potential cannibalization. In February, Solomon stated that Goldman was considering "strategic alternatives" for its consumer platforms business.
Image source: FT.com
✔️ Goldman Sachs misses revenue estimates after taking $470 million hit on Marcus loans
✔️ Goldman Is Exploring GreenSky Sale. Its Consumer Business Is Going Away
✔️ Goldman Sachs is watching for ‘cannibalization’ from Apple’s new savings account
✔️ Rarely-humbled Goldman Sachs concedes missteps in plan to take on megabanks in retail finance
Chart of the Day
The next to report their Q1 2023 results are credit card companies with Synchrony Financial (NYSE: SYF) reporting today (April 19), American Express (NYSE: AXP), Discover Financial (NYSE: DFS) reporting tomorrow (April 20), and Capital One (NYSE: COF) reporting next week. So I thought I’d throw in a chart on credit card debt in the United States. Thus, per the Federal Bank of New York, credit card debt marched past its pre-pandemic level of $0.93 trillion at the end of Q4 2019, and was just a bit short of a trillion dollars at the end of 2022 ($0.99 trillion to be precise).
Data source: Federal Reserve Bank of New York
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That’s it for today! Thank you for reading and see you tomorrow!
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Cover image source: Coinbase
Disclaimer: Information contained in this newsletter is intended for educational and informational purposes only and should not be considered financial advice. You should do your own research or seek professional advice before making any investment decisions.