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Coinbase reported $1.9 billion in third-quarter revenue on Thursday, a 26% increase quarter-over-quarter that slightly surpassed Wall Street forecasts.

Analysts expected the San Francisco-based crypto exchange to disclose $1.8 billion in sales, reflecting a 50% increase from a year ago, according to Yahoo Finance. Coinbase disclosed a Q3 earnings per share of $1.50, coming in above analysts’ forecasts of $1.10 per share.

That translated into $433 million in net income for the third quarter, falling sequentially from $1.4 billion. A year ago, Coinbase notched $75 million in third-quarter income.

The sequential drop in net income was attributable to mark-to-market adjustments in the value of Coinbase’s stake in stablecoin issuer Circle, as well as its crypto portfolio, Coinbase’s Vice President of Investor Relations Anil Gupta told Decrypt.

“There’s non-cash noise in the net income number,” he said. “Margins were strong. Revenue growth was strong. Overall, kind of a great quarter for us.”

Coinbase shares rose in after-hours trading to $341. Year-to-date, the company’s stock price has increased around 33%, after peaking around $444 per share in mid-July. 

In the third quarter, Bitcoin and Ethereum roared to all-time highs, creating conditions for a potential bounce back after the exchange said traders pulled back in the second quarter amid macroeconomic headwinds and rising geopolitical tensions.

In the three months ended Sept. 30, Coinbase earned $1 billion from facilitating customers’ transactions, including institutions on its platform. That represented a 37% increase quarter-over-quarter from $764 million, while also being up from $573 million a year ago.

Over time, Coinbase has sought to diversify its business away from a reliance on transaction fees. That includes its staking services and revenue from reserves backing Circle’s USDC stablecoin, which fall under the exchange’s subscriptions and services umbrella.

Coinbase disclosed $355 million in Q3 stablecoin revenue, a 43% increase from $247 million a year prior. Meanwhile, Coinbase earned $185 million from so-called blockchain rewards.

In the third quarter, USDC’s market cap reached an all-time high of $74 billion, alongside a record $15 billion in USDC held in Coinbase’s products.

Gupta highlighted “really good progress” with Coinbase’s derivatives business following its acquisition of Deribit. Combined, the exchanges facilitated $840 billion worth of notional derivatives trading volume in the third quarter.

Since the company debuted an Ethereum layer-2 scaling network in 2023, Coinbase has leaned into Base as a way to augment its services. In mid-September, the company said it was considering a token for Base, but there’s no set timeline or design yet.

Still, JPMorgan analysts estimated earlier this month that a token for Base could add up to $12 billion in value to Coinbase. In the note, the Wall Street bank lifted its price target to $404, while projecting a market capitalization of $12 billion to $34 billion for Base’s token.

In its earnings statement, Coinbase highlighted user growth for Base, noting that “Base revenue growth was driven by higher average ETH price and a higher number of transactions.” 

Among layer-2 networks, Base leads in terms of stablecoin adoption, with $4.6 billion worth of dollar-pegged tokens, according to crypto data provider DeFiLlama.

Earlier this month, the exchange said that it applied for a national bank trust charter, following in the footsteps of stablecoin issuers Circle and Paxos and Ripple, the XRP-linked fintech.

Over the summer, Coinbase unveiled plans to offer tokenized assets to customers, following similar announcements from competitors like Kraken and Robinhood.

Through weekly purchases, Coinbase said that it increased its Bitcoin holdings by $299 million in Q3. As of Sept. 30, the fair value of digital assets held for investment purposes was $2.6 billion, Coinbase said.

The increase was underscored, on a Bitcoin basis, by Coinbase CEO Brian Armstrong on X.

“Coinbase is long Bitcoin,” he said. “And we keep buying more.”

Editor’s note: This story was updated after publication with a comment from Coinbase and additional detail.