Under immense performance pressure, Coinbase opens registration to Chinese users

Original | Odaily (@OdailyChina)

Author | Golem (@web3_golem)

On July 14, community users discovered that Coinbase had quietly opened registration for users in the Chinese-speaking region — without requiring proof of an overseas address. Users could successfully register using just their Mainland China ID card and phone number, with the entire verification process taking less than a minute. As of the time of writing, the registration channel remains open.

According to Q1 2026 financial reports, Coinbase's global crypto trading market share stands at 8.6% (not including the Chinese-speaking market). Coinbase had previously maintained a restrictive stance on KYC for Chinese users. In April 2025, it briefly opened registration for Chinese users, where those using a Chinese passport plus overseas proof like a Hong Kong address had a chance to register successfully, but those accounts were subsequently mass-banned.

Therefore, July 14 can be seen as the first time Coinbase has meaningfully opened registration to Mainland users. Coinbase has yet to make any official statement or explanation, but the market has interpreted this as a significant signal of its accelerated push into international markets. According to Gate US stock data, Coinbase (COIN) shares closed up 2.62% on July 14 and rose an additional 0.74% in pre-market trading today.

Under Earnings Pressure, Coinbase Sets Sights on Chinese Users

According to the National Cryptocurrency Association (NCA), the US is the leading regional market for crypto trading volume by market share. As of 2026, approximately 67 million American adults hold cryptocurrency, accounting for about 25% of the US adult population. While precise statistics are difficult to obtain, the Chinese user base and the broader Chinese-speaking market are certainly among the top three global regional crypto trading markets, with major exchanges like Binance and OKX treating the Chinese-speaking region as a primary market.

Coinbase, once "aloof," is now quietly opening its doors to Chinese users. This shift is not sudden; the reasons have been written in every past financial report.

Coinbase has reported net losses for two consecutive quarters, with a net loss of $666.7 million in Q4 2025 and $394.1 million in Q1 2026. Coinbase attributed the Q1 2026 losses primarily to a weak crypto market, but looking at the longer trend, its revenue had actually started declining from 2025 onwards.

Coinbase Quarterly Revenue

Coinbase's main revenue source remains its transaction brokerage business, with retail users contributing 80% of its total trading revenue. Since 2025, Coinbase's transaction brokerage revenue has been on a downward trend, with the significant retail trading revenue declining notably: retail trading revenue in Q1 2025 was $1.096 billion, but by Q1 2026, it had fallen to just $567 million, a year-over-year decrease of 48.2%.

Coinbase Quarterly Trading Revenue

The downturn in the crypto market and sluggish user trading volume are only part of the reason for Coinbase's declining retail trading revenue. Another key factor is increased competition in its domestic market and user churn.

Coinbase's early monopoly in the US market, built on its "compliance reputation," has long since vanished with the maturation of US regulation. Over ten exchanges have obtained licenses to offer crypto trading services to US users, including Robinhood, Kraken, and Binance.US. Without exception, these exchanges charge lower fees than Coinbase. Once security and trust are no longer barriers to entry, retail users naturally gravitate towards platforms with lower fees.

Fee Percentage Charged by Different Exchanges

Faced with this pressure, Coinbase has begun to vigorously develop businesses beyond spot crypto trading, such as derivatives trading, prediction markets, and tokenized stocks, attempting to rebrand itself as an "exchange for everything." Whether these combined businesses can challenge the position of spot crypto trading in Coinbase's revenue will only be answered once the Q2 2026 financial report is released.

Under earnings pressure, the stubborn bull Coinbase has finally seen the light. Since competitors are coming to the US to poach its users, why shouldn't Coinbase venture out into the world? After all, outside the US, everything is incremental growth. Therefore, Coinbase's primary target is the Chinese-speaking market, one of the top three globally for crypto trading volume.

Coinbase's opening of KYC for China also exploits a loophole in US law.

Crypto KOL Phyrex (X: @PhyrexNi) stated that Coinbase cannot offer services to countries and regions sanctioned by the US OFAC, and China is not on that list. Therefore, providing services to Chinese users is not illegal in the US. However, for Chinese users, Coinbase is not compliant in China, and crypto trading itself operates in a legal grey area. Should a dispute arise between a Chinese user and Coinbase, the worst-case scenario is that neither US law nor Chinese law would offer the user protection.

Coinbase's Advantages Are Mainly in the US

Beyond compliance issues, from a product usage perspective, most Chinese-speaking users have already become disillusioned with Coinbase because its advantages are primarily limited to the US. In the international arena, crypto users have an overwhelming number of choices. To put it more bluntly, registering for Coinbase now is of little practical use. Most users rushing to register are doing so with a "better to have it and not need it" mindset.

From 2021 to 2024, Coinbase did have a "listing effect." When Coinbase announced support for or listed a token, its price often saw a short-term significant surge, as seen with tokens like LINK, POL, and AAVE.

Back then, Coinbase was the largest compliant exchange in the US with extremely strict listing criteria, potentially listing only a few dozen projects per year. This meant that tens of millions of US investors and institutions could only buy coins compliantly through Coinbase. Thus, listing on Coinbase equated to an influx of new demand, making the listing effect very pronounced.

However, with the relaxation of US crypto regulation in recent years and investors having more purchasing channels, including numerous traditional brokerages and DEXs, Coinbase's role as the "gatekeeper of capital" in the US crypto market has diminished, and its listing effect has naturally faded.

Coinbase CEO Brian Armstrong stated boldly during the Q1 earnings call, "Customers choose us not because we have the lowest fees, but because we offer products that meet their needs." So, setting aside Coinbase's high fees for retail traders (up to 1.2%), looking purely at product and usability, Coinbase not only lacks differentiation but also fails to meet the needs of Chinese users.

Firstly, although Coinbase has opened KYC for Chinese users, it cannot support fiat currency deposits and withdrawals. This limitation alone is enough to deter most people. Secondly, looking at the currently popular tokenized US stocks, while Coinbase claims to be developing this business, its supported products and market share lag far behind Binance's bStocks and Hyperliquid — which even recently listed a pre-market contract for China's CXMT (ChangXin Memory Technologies) A-share stock. Furthermore, Coinbase's product experience and support in areas like Meme coins and prediction markets offer no clear advantages.

Today's Coinbase can only be described as "expensive and useless." To truly break into the Chinese-speaking market, it will need more than just quietly relaxing registration; it requires corresponding exclusive launchpad activities or other wealth-generating effects. Otherwise, it will truly be a wasteland.