Ether is waking up with a bullish bunching of the moving averages and a huge upward sloping triangle pattern forming. They look like a buy now with the possibility of a massive chart breakout ahead. Legendary investor and bane of Guardian readers, Peter Thiel, is buying the story.
Stocks with exposure to crypto, like Coinbase Global, Robinhood and Futu Holdings, are all doing well and look set to do better.
This chart of Coinbase looks incredible. Coppock turning higher, bullish moving averages and a breakout from a massive pattern.
These guys have serious ambition.
Coinbase was founded to increase economic freedom in the world. We think cryptocurrency is the most important technology to update the financial system and create that economic freedom for people all over the world. Many people today don’t have access to good financial services, and it’s holding back progress. Everyone deserves access to basic financial infrastructure, good proper sound money, free from high inflation, the ability to get a loan, make payments without high fees and delays, and to choose what to do with their own money.
Greater economic freedom is correlated with all sorts of outcomes we want in society, like higher GDP per capita, self-reported happiness, and income for the bottom 10%. It’s foundational to all progress. Now this ties into all the products we build across multiple customer groups, including regional businesses, institutions and developers, and serving these multiple customer groups has the potential to create synergies in our business over time.
For instance, our emerging payments business drives volume on our exchange or by serving retail, pro, and institutional traders all in one platform, we get more liquidity and order flow on our exchange. We have retail customers who want to spend crypto. We also have businesses who want to accept crypto. That’s sparking economic activity. So our goal is to be the number one financial services platform in the world across each of the customer groups we serve with crypto rails eventually powering the majority of global GDP.
Brian Armstrong, CEO, Coinbase Global, Q1 2025, 8 May 2025
There is a great deal going on at Coinbase.
So for this first one, we are driving more revenue in our core businesses. Let’s start with trading. We are continuing to gain share in Q1 in spot and derivatives. We drove over $800 billion in global derivatives trading volume. While still early, this is a significant market share increase driven by our international exchange where we saw our perps market share increase by over 60%.
This morning, we announced the acquisition of Deribit, the world’s leading crypto options exchange with over $30 billion of open interest and $1 trillion in trading volume outside the U.S. last year. This makes Coinbase the number one crypto derivatives platform globally by open interest. And it’s our biggest move yet to accelerate our international roadmap and build out this comprehensive trading platform.
The traders benefit from having spot, futures and now options together under one roof. So Deribit is a very important piece of the puzzle for us to bring this together all at Coinbase. We also launched portfolio margin 2.0, expanding access to long short capabilities and increasing leverage for our institutional traders and we made great strides across our stretch goal to make USDC* the number one dollar stablecoin as well. In fact, USDC hit a market cap all time high of $60 billion in Q1 and the average USDC held in Coinbase products increased 49% quarter-over-quarter to $12 billion.
*USD Coin (USDC) is a stablecoin pegged to the US dollar and redeemable on a 1:1 basis for US dollars, backed by dollar-denominated assets held in segregated accounts with US-regulated financial institutions.
Brian Armstrong, CEO, Coinbase Global, Q1 2025, 8 May 2025
It’s all go at Coinbase.
Next up, we accelerated our international expansion for our core businesses. We continued to repeat our successful international playbook driven by obtaining new licenses. So we secured a vast registration in Argentina. We also registered with India’s financial intelligence unit, FIU, unlocking access to one of the fastest growing crypto markets. It’s really great to see this product execution at a rapid pace in our core businesses. The second, as I mentioned, we’re also focused on driving utility for the next wave of crypto adoption and some more emerging products.
So first, under this section, stablecoin payments have seen enormous growth lately, and we’ve started to build a business account for Coinbase, which includes B2B [business to business] payment features for startups and SMBs [small and medium sized businesses]. In Q2, we’ll be onboarding the first businesses to our pilot, enabling them to make stablecoin pay ins and payouts.
Given Coinbase’s long history building crypto infrastructure, custody, trading and our network of bank partners around the world, we think we’re well positioned to power stablecoin payments for many businesses. This quarter, we also expanded our on chain lending products powered by Base. We launched Bitcoin backed USDC borrowing. This is giving users instant liquidity without having to sell their Bitcoin. In the first one hundred days, we saw over $100 million in loans.
It’s now up to $160 million in loans. Since January, it’s growing at a really incredible pace so we have found a lot of success with that product. We are also continuing to focus on empowering builders on Base. We think this is a big opportunity for the next wave of adoption.
Brian Armstrong, CEO, Coinbase Global, Q1 2025, 8 May 2025
Coinbase is special.
So in closing, it’s important to realize that crypto is eating financial services and coin base is 100% focused on crypto. We are building better financial infrastructure for the world, which will enable more economic freedom.
We have been focused on crypto since the beginning 12 years ago, and we continue to be focused there, executing at a rapid pace. With growing regulatory clarity, we believe crypto rails are poised to power an increasing share of global GDP and update every aspect of the financial system over time.
Brian Armstrong, CEO, Coinbase Global, Q1 2025, 8 May 2025
I think it is also time to take note of the accelerating rise in shares of Roblox.
Roblox’s mission is to build a human co-experience platform that enables billions of users to come together to play, learn, communicate, explore and expand their friendships.
Roblox is powered by a global community of millions of developers who produce their own immersive multiplayer experiences using Roblox Studio, our intuitive desktop design tool.
Roblox is ranked as one of the top online entertainment platforms for audiences under the age of 18 based on average monthly visits and time spent (Comscore). Our popularity is driven purely by our community of users and developers.
Roblox website
Central to Quentinvest is the concept that rising share prices are driven by businesses growing bigger. Roblox continues to scale at a rapid rate and has ambitious goals.
We saw high growth rates in many, if not, all of our operating metrics. Q1 revenue was $1.035 billion, that was up 29% year-on-year. And ahead of our guidance of $990 million to $1,015 million or $1.015 billion. Our Q1 bookings were $1.207 billion, that was up 31% year-on-year. And that was ahead of the high end of our guidance, which was $1.125 billion to $1.15 billion. Q1 DAUs [daily active users], 97.8 million, just shy of 100 million DAUs, up 26% year-on-year.
And let’s dive into a couple of the areas we’ve been talking about growing ever since our S1 [IPO]. First, U.S. and Canada still growing with solid DAU growth of 22%. APAC [Asia Pacific] 40%. Japan one of the largest gaming markets growing 48% year-on-year, and India growing 77% year-on-year. We’ll talk a bit about some of the performance, things we’re doing on our app and ecosystem to support that. And on demographics, very large opportunity for us over 13. Thirteen and up DAUs grew at 36% year-on-year. And now our DAUs are at 62% over 13. On hours, we hit 21.7 billion hours in Q1, that’s up 30% year-on-year. Similar to the DAU trend, US-Canada 27%, APAC 40% — 44% growth. Japan hours 50% year-on-year. India hours 78% year-on-year. 13 and up 40% engagement growth year-on-year. And on the hours, very similar to DAU, 64% of the hours in 13 and up.
David Baszucki, CEO, Roblox, Q1 2025, 1 May 2025
Consumers under 13 consume a great deal of gaming. Consumers over 13 consume more of everything, which is why Roblox is so keen on growing the age profile of its ecosystem.
Being a creator on Roblox is a massive business opportunity.
We have a lot of creators of all sizes. We’re trying to really drive search and discovery, not just with short-term optimization, but factoring long-term ecosystem health, which is really long-term enterprise value, into our search and discovery and recommendation algorithms. I’ll share a few results. Our top 100 creators now earned $6.7 million on average in the last 12 months. That’s up 35% versus the 12 month period ended March 31st, 2024. And the top 100 creators earned over $1 million in the last 12 months. That means a creator number 100, if we stack rank them by earnings over the top 12 months, creator number 100 earned over a million. So we have over 100 creators and studios supporting themselves, which is a great diversity of content.
And discovery efforts are really helping. 24% of the top 100 experiences by spending in March were created in the last 12 months, which is amazing content velocity. Let’s look at the top 10 creators. They earned $36 million on average in the last 12 months. That’s up 28% versus the 12 months ended March 31st, 2024. We highlighted at RDC [Roblox Developers Conference], I guess it was just last year, the goal of having a Roblox Studio valued at $1 billion. We’re seeing a lot of M&A [mergers and acquisitions] action in the Roblox ecosystem. You can read about it on the news. And we’re really proud that we’re starting to see this kind of growth on the platform.
David Baszucki, CEO, Roblox, Q1 2025, 1 May 2025
By this time, I was starting to wonder how Roblox makes money.
Roblox primarily makes money through the sale of its virtual currency, Robux, which users purchase to buy virtual items and experiences within the platform. Roblox then shares a portion of these revenues with creators, who can also earn through in-experience purchases and other monetization methods. Additionally, Roblox earns revenue through advertising, licensing, and royalties.
AI Overview
To an old school guy like me, it sounds as though Roblox sells nothing to its customers for nothing, shares part of this nothing with its community of creators, and somehow this turns into a growing stream of dollars. Who am I to cavil? It works for them. The something is the experiences they are all having or creating, and these seem real to an expanding ecosystem of engaged individuals.
The miracle at the heart of much of this is dollars, which, 50-odd years ago, were backed by gold but increasingly are just Visa, Klarna, Apple Pay, invisible money whizzing around the world at an incredible rate. I go into Bayley & Sage, buy some peaches and apricots, wave a piece of plastic, and a debit entry on my account becomes a credit on theirs. I barely even notice that I have paid a double-figure amount for four pieces of fruit.
The chart shows an extended share price which could react at any time, but overall presents the strong picture I like to see.
Share Recommendations
Roblox. RBLX
Coinbase Global. COIN
All the numbers at Roblox are moving in the right direction.
On margins, we’re just really pleased with the margin growth in the business and the cashflow generation in the business. Since we had Investor Day, late 2023 over the last six quarters, we have just dramatically outperformed the notion of 100 to 300 basis point improvement. We’re just well, well above that. In this quarter, adjusting for a working capital benefit that we got in Q1, operating cashflow grew at over 70% year-over-year. Free cashflow more than doubled year-over-year, over 400 — right about $400 million for the quarter.
At the same time, we are hiring and we are retaining great people where we only diluted the business by about 2.2% year-over-year, which means our per share metrics are very strong. We think that’s great for investors. So with the kind of top line growth we’re driving, the kind of cashflow growth we’re driving, per share metrics with a small amount of dilution look really fantastic. So all in all, the financials look great. The balance sheet is incredibly strong. We have $4.5 billion of gross cash, $3.5 billion of net cash. That number has grown dramatically over the last two years. So the liquidity of the company is really strong.
Mike Guthrie, CFO, Roblox, Q1 2025, 1 May 2025
I am adding Coinbase Global and Roblox to my Top 20 list, making the actual number 20.
Strategy – Avoid 5x Leverage; It Is Too High
Five times leverage is a formula for disaster. If share prices fall 10pc, the stress is overwhelming. If they fall 20pc, which they will periodically, you are wiped out. The sweet spot for leverage is probably two, perhaps three.
What is certain is that a long-term investor with two times leverage will ALWAYS beat an investor with five times leverage. If your objective is to make money, stick to two times, max three. If you are happy with quick thrills and a roller-coaster ride, then go for five.
It is all about self-discipline. So here we go, I have made my appointment with Gamblers Anonymous. Let’s see what they can do to make me rich.
I had a lesson from my son. He decided his leverage was too high. Sold a load of shares to take his leverage down to two times, and the profits are racking up nicely.
