CoinShares reveals loss in second-quarter earnings driven in part by UST collapse

Quick Take

  • CoinShares reported a 128% decline in second quarter adjusted EBITDA. 
  • The firm’s reported losses from its TerraUSD (UST) exposure were just over $21 million.
  • The firm’s CEO said we have seen the worst of the contagion following the Terra collapse. 

Digital asset manager CoinShares reported losses in the second quarter as the firm suffered over $21 million in losses following the de-pegging and subsequent collapse of TerraUSD (UST).

Adjusted earnings before interest, taxes, depreciation and amortization, or EBITDA – a popular measure of a company’s financial performance – was negative £8.2 million (just over $10 million). This is down from a positive EBITDA of £28.6 million a year earlier, according to a statement on Tuesday. 

The firm said that decreased revenue, gains and significant losses relating to the TerraUSD collapse as well as the costs related to its ongoing expansion caused the negative performance.  CoinShares position in TerraUSD was $120 million at one stage, although it reduced its risk during the de-pegging for a loss of just over $21 million.

When asked about its expansion plans during its earnings call CFO Richard Nash said the firm is being “more cautious” with its growth plans, although it wants to be ready to capitalize on the next period of growth in crypto.  

CoinShares CEO Jean-Marie Mognetti shared his views on contagion in the crypto space, saying that we have seen the worst of contagion – before noting there is some potential for contagion risk in Asia.  

Mognetti was particularly critical of centralized lending platforms in response to a question about the firm's position in Maple Finance and TrueFi. The CEO said there is a lack of transparency when it comes to centralised lending platforms, going on to add that decentralized protocols are the future of finance.  

CoinShares stock price was down 0.48% on Tuesday trading at 30.95 SEK – approximately $3.03. The stock was trading as low as 26.30 SEK just under a week ago on July 27. 


© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

Adam Morgan is The Block's markets reporter. He has been based in London for the past year, initially freelancing and working for a start-up there before beginning a fellowship at Business Insider. He Tweets @AdamMcMarkets