COINBASE GLOBAL, INC., 10-K filed on 2/25/2022
Annual Report
v3.22.0.1
Cover Page - USD ($)
$ in Billions
 12 Months Ended
Dec. 31, 2021
Feb. 16, 2022
Jun. 30, 2021
Entity Information [Line Items]      
Document Type 10-K    
Document Annual Report true    
Document Period End Date Dec. 31, 2021    
Current Fiscal Year End Date --12-31    
Document Transition Report false    
Entity File Number 001-04321    
Entry Registrant Name Coinbase Global, Inc.    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 46-4707224    
Title of 12(b) Security Class A common stock, $0.00001 par value per share    
Trading Symbol COIN    
Security Exchange Name NASDAQ    
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Interactive Data Current Yes    
Entity Filer Category Non-accelerated Filer    
Entity Small Business false    
Entity Emerging Growth Company false    
ICFR Auditor Attestation Flag false    
Entity Shell Company false    
Entity Public Float     $ 33.5
Documents Incorporated by Reference DOCUMENTS INCORPORATED BY REFERENCEPortions of the registrant’s definitive proxy statement for its 2022 Annual Meeting of Stockholders, or Proxy Statement, to be filed within 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K, are incorporated by reference in Part III. Except with respect to information specifically incorporated by reference in this Annual Report, the Proxy Statement shall not be deemed to be filed as part hereof.    
Entity Central Index Key 0001679788    
Amendment Flag false    
Document Fiscal Year Focus 2021    
Document Fiscal Period Focus FY    
Class A common stock      
Entity Information [Line Items]      
Entity Common Stock, Shares Outstanding   171,169,869  
Class B common stock      
Entity Information [Line Items]      
Entity Common Stock, Shares Outstanding   48,309,752  
v3.22.0.1
Audit Information
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2019
Audit Information [Abstract]    
Auditor Name Deloitte Grant Thornton
Auditor Location San Francisco, California New York, New York
Auditor Firm ID 34 248
v3.22.0.1
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Current assets:    
Cash and cash equivalents $ 7,123,478 $ 1,061,850
Restricted cash 30,951 30,787
Customer custodial funds 10,526,233 3,763,392
USDC 100,096 48,938
Accounts and loans receivable, net of allowance 396,025 189,471
Income tax receivable 61,231 0
Prepaid expenses and other current assets 135,849 39,510
Total current assets 18,373,863 5,133,948
Crypto assets held 988,193 316,094
Lease right-of-use assets 98,385 100,845
Property and equipment, net 59,230 49,250
Goodwill 625,758 77,212
Intangible assets, net 176,689 60,825
Other non-current assets 952,307 117,240
Total assets 21,274,425 5,855,414
Current liabilities:    
Custodial funds due to customers 10,480,612 3,849,468
Accounts payable 39,833 12,031
Accrued expenses 439,559 88,783
Crypto asset borrowings 426,665 271,303
Lease liabilities, current 32,366 25,270
Total current liabilities 11,419,035 4,246,855
Lease liabilities, non-current 74,078 82,508
Long-term debt 3,384,795 0
Other non-current liabilities 14,828 0
Total liabilities 14,892,736 4,329,363
Commitments and contingencies (Note 19)
Convertible preferred stock, $0.00001 par value; 500,000 and 126,605 shares authorized at December 31, 2021 and December 31, 2020, respectively; zero and 112,878 shares issued and outstanding at December 31, 2021 and December 31, 2020, respectively; aggregate liquidation preference of $0 and $578,750 at December 31, 2021 and December 31, 2020, respectively 0 562,467
Stockholders’ equity:    
Additional paid-in capital 2,034,658 231,024
Accumulated other comprehensive (loss) income (3,395) 6,256
Retained earnings 4,350,424 726,304
Total stockholders’ equity 6,381,689 963,584
Total liabilities, convertible preferred stock, and stockholders’ equity 21,274,425 5,855,414
Class A common stock    
Stockholders’ equity:    
Common stock 2 0
Class B common stock    
Stockholders’ equity:    
Common stock $ 0 $ 0
v3.22.0.1
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Convertible preferred stock, par value (in dollars per share) $ 0.00001 $ 0.00001
Shares authorized (in shares) 500,000,000 126,605,000
Shares issued (in shares) 0 112,878,000
Shares outstanding (in shares) 0 112,878,000
Liquidation Preference $ 0 $ 578,750
Class A common stock    
Common stock, par value (in dollars per share) $ 0.00001 $ 0.00001
Common stock, authorized (in shares) 10,000,000,000 267,640,000
Common stock, issued (in shares) 168,807,000 12,204,000
Common stock, outstanding (in shares) 168,807,000 12,204,000
Class B common stock    
Common stock, par value (in dollars per share) $ 0.00001 $ 0.00001
Common stock, authorized (in shares) 500,000,000 208,414,000
Common stock, issued (in shares) 48,310,000 60,904,000
Common stock, outstanding (in shares) 48,310,000 60,904,000
v3.22.0.1
Consolidated Statements of Operations - USD ($)
shares in Thousands, $ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Revenue:      
Revenue $ 7,839,444 $ 1,277,481 $ 533,735
Operating expenses:      
Transaction expense 1,267,924 135,514 82,055
Technology and development 1,291,561 271,732 185,044
Sales and marketing 663,689 56,782 24,150
General and administrative 909,392 279,880 231,929
Restructuring 0 0 10,140
Other operating expense, net 630,308 124,622 46,200
Total operating expenses 4,762,874 868,530 579,518
Operating income (loss) 3,076,570 408,951 (45,783)
Other expense (income), net 49,623 (248) (367)
Income (loss) before income taxes 3,026,947 409,199 (45,416)
(Benefit from) provision for income taxes (597,173) 86,882 (15,029)
Net income (loss) 3,624,120 322,317 (30,387)
Net income (loss) attributable to common stockholders:      
Basic 3,096,958 108,256 (30,387)
Diluted $ 3,190,404 $ 127,471 $ (30,387)
Net income (loss) per share attributable to common stockholders:      
Basic (in dollars per share) $ 17.47 $ 1.58 $ (0.50)
Diluted (in dollars per share) $ 14.50 $ 1.40 $ (0.50)
Weighted-average shares of common stock used to compute net income (loss) per share attributable to common stockholders:      
Basic (in shares) 177,319 68,671 61,317
Diluted (in shares) 219,965 91,209 61,317
Net revenue      
Revenue:      
Revenue $ 7,354,753 $ 1,141,167 $ 482,949
Other revenue      
Revenue:      
Revenue $ 484,691 $ 136,314 $ 50,786
v3.22.0.1
Consolidated Statements of Comprehensive Income (Loss) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Statement of Comprehensive Income [Abstract]      
Net income (loss) $ 3,624,120 $ 322,317 $ (30,387)
Other comprehensive (loss) income:      
Translation adjustment, net of tax (9,651) 6,977 (43)
Comprehensive income (loss) $ 3,614,469 $ 329,294 $ (30,430)
v3.22.0.1
Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders' Equity - USD ($)
$ in Thousands
Total
Convertible Preferred Stock
Common Stock
Additional Paid-In Capital
Accumulated Other Comprehensive (Loss) Income
Retained Earnings
Beginning balance (in shares) at Dec. 31, 2018   120,929,000        
Beginning balance at Dec. 31, 2018   $ 569,232        
Increase (Decrease) in Temporary Equity [Roll Forward]            
Conversion of preferred stock (in shares)   (5,970,000) 5,970,000      
Conversion of preferred stock $ 4,535 $ (4,535) $ 0 $ 4,535    
Ending balance (in shares) at Dec. 31, 2019   114,959,000        
Ending balance at Dec. 31, 2019   $ 564,697        
Beginning balance (in shares) at Dec. 31, 2018     59,850,000      
Beginning balance at Dec. 31, 2018 500,071   $ 0 47,257 $ (678) $ 453,492
Increase (Decrease) in Stockholders' Equity [Roll Forward]            
Issuance of Class A common stock (in shares)     154,000      
Issuance of Class A common stock 5,000     5,000    
Repurchase of equity awards (shares)     (212,000)      
Repurchase of equity awards (20,246)     (1,128)   (19,118)
Issuance of common stock upon exercise of stock options, net of repurchases (in shares)     951,000      
Issuance of common stock upon exercise of stock options, net of repurchases 4,232     4,232    
Vesting of restricted stock (shares)     199,000      
Vesting of restricted stock 1,389     1,389    
Stock-based compensation expense 32,535     32,535    
Conversion of preferred stock (in shares)   (5,970,000) 5,970,000      
Conversion of preferred stock 4,535 $ (4,535) $ 0 4,535    
Comprehensive income (loss) (43)       (43)  
Net income (loss) (30,387)         (30,387)
Ending balance (in shares) at Dec. 31, 2019     66,994,000      
Ending balance at Dec. 31, 2019 497,086   $ 0 93,820 (721) 403,987
Increase (Decrease) in Temporary Equity [Roll Forward]            
Conversion of preferred stock (in shares)   (2,081,000) 2,081,000      
Conversion of preferred stock $ 2,230 $ (2,230) $ 0 2,230    
Ending balance (in shares) at Dec. 31, 2020 112,878,000 112,878,000        
Ending balance at Dec. 31, 2020 $ 562,467 $ 562,467        
Increase (Decrease) in Stockholders' Equity [Roll Forward]            
Repurchase of equity awards (1,930)     (1,930)    
Issuance of common stock upon exercise of stock options, net of repurchases (in shares)     2,038,000      
Issuance of common stock upon exercise of stock options, net of repurchases 16,707     16,707    
Stock-based compensation expense 72,643     72,643    
Issuance of equity instruments as consideration in business combination (in shares)     1,304,000      
Issuance of equity instruments as consideration for business combinations 31,349     31,349    
Issuance of common stock to settle contingent consideration (in shares)     691,000      
Issuance of common stock to settle contingent consideration 16,205     16,205    
Conversion of preferred stock (in shares)   (2,081,000) 2,081,000      
Conversion of preferred stock 2,230 $ (2,230) $ 0 2,230    
Comprehensive income (loss) 6,977       6,977  
Net income (loss) 322,317         322,317
Ending balance (in shares) at Dec. 31, 2020     73,108,000      
Ending balance at Dec. 31, 2020 963,584   $ 0 231,024 6,256 726,304
Increase (Decrease) in Temporary Equity [Roll Forward]            
Conversion of preferred stock (in shares)   (112,878,000) 112,878,000      
Conversion of preferred stock $ 562,467 $ (562,467) $ 2 562,465    
Ending balance (in shares) at Dec. 31, 2021 0 0        
Ending balance at Dec. 31, 2021 $ 0 $ 0        
Increase (Decrease) in Stockholders' Equity [Roll Forward]            
Issuance of common stock upon exercise of stock options, net of repurchases (in shares) 24,920,000   24,909,000      
Issuance of common stock upon exercise of stock options, net of repurchases $ 212,476     212,476    
Stock-based compensation expense (shares) 82,000          
Stock-based compensation expense $ 824,153     824,153    
Issuance of equity instruments as consideration in business combination (in shares)     3,985,000      
Issuance of equity instruments as consideration for business combinations 544,588     544,588    
Conversion of preferred stock (in shares)   (112,878,000) 112,878,000      
Conversion of preferred stock 562,467 $ (562,467) $ 2 562,465    
Issuance of common stock from exercise of warrants (in shares)     412,000      
Issuance of common stock from exercise of warrants 433     433    
Issuance of common stock upon settlement of RSUs and restricted common stock, net of shares witheld (in shares)     1,775,000      
Issuance of common stock upon settlement of RSUs and restricted common stock, net of shares withheld (262,794)     (262,794)    
Purchase of capped calls (90,131)     (90,131)    
Issuance of common stock under the Employee Stock Purchase Plan (shares)     50,000      
Issuance of common stock under the Employee Stock Purchase Plan 12,444     12,444    
Comprehensive income (loss) (9,651)       (9,651)  
Net income (loss) 3,624,120         3,624,120
Ending balance (in shares) at Dec. 31, 2021     217,117,000      
Ending balance at Dec. 31, 2021 $ 6,381,689   $ 2 $ 2,034,658 $ (3,395) $ 4,350,424
v3.22.0.1
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Cash flows from operating activities      
Net income (loss) $ 3,624,120 $ 322,317 $ (30,387)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities      
Depreciation and amortization 63,651 30,962 16,878
Impairment expense 329,652 8,355 2,252
Stock-based compensation expense 820,685 70,548 31,147
Provision for transaction losses and doubtful accounts 22,390 (2,966) (4,679)
Loss on disposal of property and equipment 1,425 355 9,073
Deferred income taxes (558,329) 474 (20,903)
Unrealized (gain) loss on foreign exchange (14,944) 1,057 (3,106)
Non-cash lease expense 34,542 25,012 13,323
Change in fair value of contingent consideration (924) 3,281 0
Realized (gain) loss on crypto assets (178,234) (23,682) 5,662
Crypto assets received as revenue (1,015,920) (94,158) (11,408)
Crypto asset payments for expenses 815,783 40,205 11,622
Fair value (gain) loss on derivatives (32,056) 5,254 0
Amortization of debt discount and issuance costs 5,031 0 0
(Gain) loss on investments (20,138) 150 245
Changes in operating assets and liabilities:      
USDC (77,471) 37,936 35,303
Accounts and loans receivable (8,016) (157,156) 30,703
Income taxes, net (62,145) 86,791 (1,912)
Other current and non-current assets (20,060) (48,677) (38,594)
Custodial funds due to customers 6,691,859 2,710,522 (130,122)
Accounts payable 27,330 6,090 (2,387)
Lease liabilities (20,596) (24,998) (11,025)
Other current and non-current liabilities 302,396 6,398 17,721
Net cash provided by (used in) operating activities 10,730,031 3,004,070 (80,594)
Cash flows from investing activities      
Purchase of property and equipment (2,910) (9,913) (33,521)
Proceeds from sale of property and equipment 31 0 2,293
Capitalized internal-use software development costs (22,073) (8,889) (6,950)
Business combination, net of cash acquired (70,911) 33,615 (5,698)
Purchase of investments (326,513) (10,329) (7,938)
Purchase of assembled workforce (60,800) 0 0
Asset acquisition 0 0 (55,389)
Proceeds from settlement of investments 5,159 303 374
Purchase of crypto assets held (3,009,086) (528,080) (271,266)
Disposal of crypto assets held 2,574,032 574,115 272,742
Loans originated (336,189) 0 0
Proceeds from repayment of loans 124,520 0 0
Net cash (used in) provided by investing activities (1,124,740) 50,822 (105,353)
Cash flows from financing activities      
Issuance of common stock upon exercise of stock options, net of repurchases 217,064 20,731 4,353
Taxes paid related to net share settlement of equity awards (262,794) 0 0
Proceeds received under the Employee Stock Purchase Plan 19,889 0 0
Cash paid to repurchase equity awards 0 (1,930) (20,958)
Issuance of shares from exercise of warrants 433 0 0
Issuance of convertible senior notes, net 1,403,753 0 0
Issuance of senior notes, net 1,976,011 0 0
Purchase of capped calls (90,131) 0 0
Proceeds from short-term borrowing 20,000 0 0
Net cash provided by (used in) financing activities 3,284,225 18,801 (16,605)
Net increase in cash, cash equivalents, and restricted cash 12,889,516 3,073,693 (202,552)
Effect of exchange rates on cash (64,883) (2,081) (170)
Cash, cash equivalents, and restricted cash, beginning of period 4,856,029 1,784,417 1,987,139
Cash, cash equivalents, and restricted cash, end of period 17,680,662 4,856,029 1,784,417
Cash, cash equivalents, and restricted cash consisted of the following:      
Cash and cash equivalents 7,123,478 1,061,850 548,945
Restricted cash 30,951 30,787 34,122
Customer custodial funds 10,526,233 3,763,392 1,201,350
Total cash, cash equivalents, and restricted cash 17,680,662 4,856,029 1,784,417
Supplemental disclosure of cash flow information      
Cash paid during the period for interest 3,793 0 0
Cash paid during the period for income taxes 68,614 62,060 2,165
Operating cash outflows for amounts included in the measurement of operating lease liabilities 20,061 40,011 14,356
Supplemental schedule of non-cash investing and financing activities      
Unsettled purchases of property and equipment 808 0 5,522
Right-of-use assets obtained in exchange for operating lease obligations 27,286 2,146 110,426
Non-cash consideration paid for business combinations 571,196 0 0
Purchase of crypto assets and investments with non-cash consideration 13,511 662 3,399
Issuance of common stock for non-cash consideration 0 0 5,000
Crypto assets borrowed 1,134,876 194,696 0
Crypto assets borrowed repaid with crypto assets $ 609,600 $ 59,171 $ 0
v3.22.0.1
NATURE OF OPERATIONS
 12 Months Ended
Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
NATURE OF OPERATIONS NATURE OF OPERATIONS
Coinbase, Inc. was founded in 2012. In April 2014, in connection with a corporate reorganization, Coinbase, Inc. became a wholly-owned subsidiary of Coinbase Global, Inc. (together with its consolidated subsidiaries, the “Company”).
The Company operates globally and is a leading provider of end-to-end financial infrastructure and technology for the cryptoeconomy. The Company offers retail users the primary financial account for the cryptoeconomy, institutions a state of the art marketplace with a deep pool of liquidity for transacting in crypto assets, and ecosystem partners technology and services that enable them to build crypto-based applications and securely accept crypto assets as payment.
In May 2020, the Company became a remote-first company. Accordingly, the Company does not maintain a headquarters.
On April 14, 2021, Coinbase completed the direct listing of its Class A common stock on the Nasdaq Global Select Market (the “Direct Listing”).
v3.22.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 12 Months Ended
Dec. 31, 2021
Accounting Policies [Abstract]  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation and principles of consolidation
The accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”), and include the accounts of the Company and its subsidiaries. The Company’s subsidiaries are entities in which the Company holds, directly or indirectly, more than 50% of the voting rights or where it exercises control. Certain subsidiaries of the Company have a basis of presentation different from GAAP. For the purposes of the consolidated financial statements, the basis of presentation of such subsidiaries is converted to GAAP. All intercompany accounts and transactions have been eliminated in consolidation.
Reclassifications
Certain prior period amounts have been reclassified in order to conform with the current period presentation. These reclassifications have no impact on the Company’s previously reported consolidated net income.
Use of estimates
The preparation of the consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions in the Company’s consolidated financial statements and notes thereto.
Significant estimates and assumptions include the determination of the recognition, measurement, and valuation of current and deferred income taxes; the fair value of stock-based awards issued; the useful lives of intangible assets; the impairment of long-lived assets; the Company’s incremental borrowing rate; the fair value of assets acquired and liabilities assumed in business combinations, including contingent consideration arrangements; the fair value of derivatives and related hedges; the fair value of long-term debt; assessing the likelihood of adverse outcomes from claims and disputes; and loss provisions.
Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties. To the extent that there are material differences between these estimates and actual results, the Company’s consolidated financial statements will be affected. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the result of which forms the basis for making judgments about the carrying values of assets and liabilities.
Foreign currency transactions
The Company’s functional currency is the U.S. dollar. The Company has exposure to foreign currency translation gains and losses arising from the Company’s net investment in foreign subsidiaries. The revenues, expenses, and financial results of these foreign subsidiaries are recorded in their respective functional currencies. The financial statements of these subsidiaries are translated into U.S. dollars using a current rate of exchange, with gains or losses, net of tax as applicable, included in Accumulated other comprehensive (loss) income (“AOCI”) within the consolidated statements of changes in convertible preferred stock and stockholders’ equity. Cumulative translation adjustments are released from AOCI and recorded in the statements of operations when the Company disposes or loses control of a consolidated subsidiary. Gains and losses resulting from remeasurement are recorded in Other income (loss), net within the consolidated statements of operations.
Business combinations
The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of the acquisition. Purchase accounting results in assets and liabilities of an acquired business being recorded at their estimated fair values on the acquisition date. Any excess consideration over the fair value of assets acquired and liabilities assumed is recognized as goodwill. Acquisition-related costs incurred by the Company are recognized as an expense in General and administrative expenses within the consolidated statements of operations.
The Company uses its best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. The Company’s estimates are inherently uncertain and subject to refinement.
During the measurement period, which may be up to one year from the acquisition date, and to the extent that the value was not previously finalized, the Company may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill. In addition, uncertain tax positions and tax-related valuation allowances are initially recorded in connection with a business combination as of the acquisition date. The Company continues to collect information about facts and circumstance that existed at the date of acquisition and reevaluates these estimates and assumptions quarterly and records any adjustments to the Company’s preliminary estimates to goodwill, provided that the Company is within the measurement period. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of operations.
Fair value measurements
The Company measures certain assets and liabilities at fair value. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
•Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
•Level 2: Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
•Level 3: Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.
Cash and cash equivalents
Cash and cash equivalents include cash and interest-bearing highly liquid investments held at financial institutions, cash on hand that is not restricted as to withdrawal or use with an initial maturity of three months or less, and cash held in accounts at crypto trading venues. Crypto asset and fiat wallet service trading venues include other crypto asset trading platforms that hold money transmitter licenses, and where the Company holds funds in its accounts with those trading platforms. Cash and cash equivalents excludes customer legal tender, which is reported separately as Customer custodial funds in the accompanying consolidated balance sheets. Refer to Customer custodial funds and custodial funds due to customers below for further details.
Restricted cash
The Company has restricted cash deposits at financial institutions related to operational restricted deposits and a standby letter of credit.
Customer custodial funds and custodial funds due to customers
Customer custodial funds represent restricted cash and cash equivalents maintained in segregated Company bank accounts that are held for the exclusive benefit of customers. Custodial funds due to customers represent cash deposits held by customers in their fiat wallets and unsettled deposits and withdrawals. The Company restricts the use of the assets underlying the customer custodial funds to meet regulatory requirements and classifies the assets as current based on their purpose and availability to fulfill its direct obligation under custodial funds due to customers.
Certain jurisdictions where the Company operates require the Company to hold eligible liquid assets, as defined by applicable regulatory requirements and commercial law in these jurisdictions, equal to at least 100% of the aggregate amount of all custodial funds due to customers. Depending on the jurisdiction, eligible liquid assets can include cash and cash equivalents, customer custodial funds, and in-transit funds receivable. As of December 31, 2021 and December 31, 2020, the Company’s eligible liquid assets were greater than the aggregate amount of custodial funds due to customers.
USDC
USD Coin (“USDC”) is accounted for as a financial instrument; one USDC can be redeemed for one U.S. dollar on demand from the issuer.
Accounts and loans receivable and allowance for doubtful accounts
Accounts and loans receivable are contractual rights to receive cash either on demand or on fixed or determinable dates, and are recognized as an asset on the Company’s balance sheet. Accounts and loans receivable consists of in-transit customer receivables, trade finance receivables, custodial fee revenue receivable, loans receivable, interest receivable, and other receivables.
In-transit customer receivables represent settlements from third-party payment processors and banks for customer transactions. In-transit receivables are typically received within one or two business days of the transaction date. The Company establishes withdrawal-based limits in order to mitigate potential losses by preventing customers from withdrawing the crypto asset to an external blockchain address until the payment settles. In certain jurisdictions, in-transit customer receivables qualify as eligible liquid assets to meet regulatory requirements to fulfill the Company’s direct obligations under custodial funds due to customers.
Trade finance receivables represent funds due for crypto assets delivered to credit eligible customers and are typically received within three business days from the transaction date. Trade finance receivables enable customers to instantly invest in crypto assets without pre-funding their trade.
Custodial fee revenue receivable represents the fee earned and receivable by the Company for providing a dedicated secure cold storage solution to customers. The fee is based on a contractual percentage of the daily value of assets under custody and is generally collected on a monthly basis. Such custodial fee revenue income is included in Net revenue in the consolidated statements of operations.
Loans receivable represent loans made to retail users and institutions. These loans are collateralized with crypto assets held by those users in their crypto asset wallet on the Company’s platform. Loans receivable are subsequently measured at amortized cost.
The Company recognizes an allowance for doubtful accounts for receivables based on expected credit losses. In determining expected credit losses, the Company considers historical loss experience, the aging of its receivable balance, and the fair value of any collateral held. For loans receivable, the Company applies the collateral maintenance provision practical expedient. The Company would recognize credit losses on these loans if there is a collateral shortfall and it is not reasonably expected that the borrower will replenish such a shortfall.
Concentration of credit risk
The Company’s cash, cash equivalents, restricted cash, customer custodial funds, and accounts and loans receivable are potentially subject to concentration of credit risk. Cash, cash equivalents, restricted cash, and customer custodial funds are placed with financial institutions which are of high credit quality. The Company invests cash, cash equivalents, and customer accounts primarily in highly liquid, highly rated instruments which are uninsured. The Company may also have deposit balances with financial institutions which exceed the Federal Deposit Insurance Corporation insurance limit of $250,000. The Company also holds cash at crypto trading venues and performs a regular assessment of these crypto trading venues as part of its risk management process.
The Company held $100.1 million and $48.9 million of USDC as of December 31, 2021 and December 31, 2020, respectively. The underlying U.S. dollar denominated assets are recognized by the issuer in U.S. regulated financial institutions on behalf of USDC holders.
As of December 31, 2021, the Company had no customers who accounted for more than 10% of the Company’s accounts and loans receivable. As of December 31, 2020, two customers accounted for more than 10% of the Company’s accounts and loans receivable. One customer had fiat of $45.0 million transferred to their platform account prior to December 31, 2020, but the Company had not yet settled the transaction by collecting payment. The Company had extended $20.5 million of trade financing to the second customer as of December 31, 2020. As these customers had transferred or were in the process of transferring funds to their portfolio equal to or in excess of the crypto assets purchased, the Company did not record an allowance for doubtful accounts.
As of December 31, 2021 and December 31, 2020, the Company had no payment processors or bank partners representing more than 10% of accounts and loans receivable. During the years ended December 31, 2021, December 31, 2020 and December 31, 2019 no customer accounted for more than 10% of total revenue.
Crypto assets held
The crypto assets held by the Company, with no qualifying fair value hedge, are accounted for as intangible assets with indefinite useful lives, and are initially measured at cost. Crypto assets accounted for as intangible assets are subject to impairment losses if the fair value of crypto assets decreases below the carrying value at any time during the period. The fair value is measured using the quoted price of the crypto asset at the time its fair value is being measured. Impairment expense is reflected in Other operating expense, net in the consolidated statements of operations. The Company assigns costs to transactions on a first-in, first-out basis.
Crypto assets held as the hedged item in qualifying fair value hedges are initially measured at cost. Subsequent changes in fair value attributable to the hedged risk are adjusted to the carrying amount of these crypto assets, with changes in fair value recorded in Other operating expense, net in the consolidated statements of operations.
The Company recognizes crypto assets received through airdrops or forks if the crypto asset is expected to generate probable future benefit and if the Company is able to support the trading, custody, or withdrawal of these assets. The Company records the crypto assets received through airdrops or forks at their cost.
Leases
The Company determines if an arrangement is a lease at inception. Operating leases are included in lease right-of-use (“ROU”) assets and lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of future minimum lease payments over the lease term. Most leases do not provide an implicit rate, so the Company uses its incremental borrowing rate. The operating lease ROU assets also include any lease payments made before commencement and exclude lease incentives.
The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that those options will be exercised. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has made the policy election to account for short-term leases by recognizing the lease payments in profit or loss on a straight-line basis over the lease term and not recognizing these leases on the Company’s consolidated balance sheets. Variable lease payments are recognized in profit or loss in the period in which the obligation for those payments is incurred. The Company has real estate lease agreements with lease and non-lease components for which the Company has made the accounting policy election to account for these agreements as a single lease component.
Property and equipment
Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the lesser of the estimated useful life of the asset or the remaining lease term. The estimated useful lives of the Company’s property, equipment, and software are generally as follows:
Property and equipmentUseful life
Furniture and fixtures
Three to five years
Computer equipment
Two to five years
Leasehold improvements
Lesser of useful life or remaining lease term
Capitalized software
One to three years
Construction-in-progress represents costs incurred on the construction of leasehold improvements that have not been completed or placed in service as of the end of the year, and accordingly, no depreciation expense has been recorded.
Capitalized software consists of costs incurred during the application development stage of internal-use software or implementation of a hosting arrangement that is a service contract. Capitalized costs consist of salaries and compensation costs for employees, fees paid to third-party consultants who are directly involved in development efforts, and costs incurred for upgrades and enhancements to add functionality of the software. Other costs that do not meet the capitalization criteria are expensed as incurred.
Long-lived assets, including ROU assets, goodwill, and acquired intangible assets
The Company evaluates the recoverability of long-lived assets on an annual basis, or more frequently whenever circumstances indicate a long-lived asset may be impaired. When indicators of impairment exist, the Company estimates future undiscounted cash flows attributable to such assets. In the event future undiscounted cash flows do not exceed the carrying amount of the assets, the asset would be considered impaired. The impairment loss is measured based upon the difference between the carrying amount and the fair value of the assets.
Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is tested for impairment at the reporting unit level on an annual basis (October 1 for the Company) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. For the periods presented, the Company did not have any goodwill impairment charges.
Acquired intangible assets with a definite useful life are amortized over their estimated useful lives on a straight-line basis. Each period, the Company evaluates the estimated remaining useful life of its intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. Intangible assets assessed as having indefinite lives are not amortized, but are assessed for indicators that the useful life is no longer indefinite or for indicators of impairment each period.
Investments
The Company holds the following categories of investments, which are included in other non-current assets in the consolidated balance sheets.
Equity method investments
The Company holds equity investments in privately held companies. The Company applies the equity method of accounting for investments in other entities when it holds between 20% and 50% of the common stock or in-substance common stock in the entity, or when it exercises significant influence over the entity. Under the equity method, the Company’s share of each entity’s profit or loss is reflected in Other expense (income), net in the consolidated statements of operations.
Strategic investments
The Company’s strategic investments primarily include investments in equity instruments where the Company (1) holds less than 20% ownership in the entity, and (2) does not exercise significant influence. These are recorded at cost and adjusted for observable transactions for same or similar investments of the same issuer (referred to as the measurement alternative) or impairment.
Crypto asset borrowings
The Company borrows crypto assets from third parties on an unsecured basis. Such crypto assets borrowed by the Company are reported in crypto assets held on the Company’s consolidated balance sheets.
The borrowings are accounted for as hybrid instruments, with a liability host contract that contains an embedded derivative based on the changes in the fair value of the underlying crypto asset. The host contract is not accounted for as a debt instrument because it is not a financial liability, is carried at the fair value of the assets acquired and reported in crypto asset borrowings in the consolidated balance sheets. The embedded derivative is accounted for at fair value, with changes in fair value recognized in Other operating expense, net in the consolidated statements of operations. The embedded derivatives are included in crypto asset borrowings in the consolidated balance sheets.
The term of these borrowings can either be for a fixed term of less than one year or can be open-ended and repayable at the option of the Company or the lender. These borrowings bear a fee payable by the Company to the lender, which is based on a percentage of the amount borrowed and is denominated in the related crypto asset borrowed. The borrowing fee is recognized on an accrual basis and is included in Other operating expense, net in the consolidated statements of operations.
Derivative contracts
Derivative contracts derive their value from underlying asset prices, other inputs or a combination of these factors. Derivative contracts are recognized as either assets or liabilities in the consolidated balance sheets at fair value, with changes in fair value recognized in Other operating expense, net.
As a result of the Company entering into transactions to borrow crypto assets, an embedded derivative is recognized relating to the differences between the fair value of the amount borrowed, which is recognized on the borrowing effective date, and the fair value of the amount that will ultimately be repaid, based on changes in the spot price of the crypto asset over the term of the borrowing. This embedded derivative is accounted for as a forward contract to exchange at maturity the fixed amount of the crypto asset to be repaid.
Derivatives designated as hedges
The Company applies hedge accounting to certain derivatives executed for risk management purposes. To qualify for hedge accounting, a derivative must be highly effective at reducing the risk associated with the exposure being hedged. The Company uses fair value hedges primarily to hedge the fair value exposure of crypto asset prices. For qualifying fair value hedges, the changes in the fair value of the derivative and the fair value of the hedged item, the crypto assets, are recognized in current-period earnings in Other operating expense, net in the consolidated statements of operations. Derivative amounts affecting earnings are recognized in the same line item as the earnings effect of the hedged item.
Revenue recognition
See Note 4. Revenue, for information on the Company’s accounting policies for revenue recognition.
Contract acquisition costs
The Company has elected to apply the practical expedient to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that would otherwise have been recognized is one year or less.
Transaction expense
Transaction expense includes costs incurred to operate the Company’s platform, process crypto asset trades, and perform wallet services. These costs include account verification fees, miner fees to process transactions on blockchain networks, fees paid to payment processors and other financial institutions for customer transaction activity, and crypto asset losses due to transaction reversals. Transaction expense also includes rewards paid to users for blockchain activities conducted by the Company, such as staking. Fixed-fee costs are expensed over the term of the contract and transaction-level costs are expensed as incurred.
Technology and development
Technology and development expenses include personnel-related expenses incurred in operating, maintaining, and enhancing the Company’s platform. These costs also include website hosting, infrastructure expenses, costs incurred in developing new products and services and the amortization of acquired developed technology.
Sales and marketing
Sales and marketing expenses primarily include costs related to customer acquisition, advertising and marketing programs, and personnel-related expenses. Sales and marketing costs are expensed as incurred.
General and administrative
General and administrative expenses include personnel-related expenses incurred to support the Company’s business, including legal, finance, compliance, human resources, customer support, executive, and other support operations. These costs also include software subscriptions for support services, facilities and equipment costs, depreciation, amortization of acquired customer relationship intangible assets, gains and losses on disposal of fixed assets, legal reserves and settlements, and other general overhead. General and administrative costs are expensed as incurred.
Other operating expense, net
Other operating expense, net includes cost of the Company’s crypto assets used to fulfill customer accommodation transactions. Periodically, as an accommodation to customers, the Company may fulfill customer transactions using its own crypto assets. The Company has custody and control of the crypto assets prior to the sale to the customer. Accordingly, the Company records the total value of the sale in other revenue and the cost of the crypto asset in other operating expense.
Other operating expense, net also includes impairment and realized gains on the sale of crypto assets, realized gains and losses resulting from the settlement of derivative instruments, and fair value gains and losses related to derivatives and derivatives designated in qualifying fair value hedge accounting relationships.
Stock-based compensation
The Company recognizes stock-based compensation expense using a fair-value based method for costs related to all equity awards granted under its equity incentive plans to employees, directors and non-employees of the Company including restricted stock, restricted stock units (“RSUs”), stock options and purchase rights granted under the Company’s 2021 Employee Stock Purchase Plan (the "ESPP").
The fair value of restricted stock and RSUs is estimated based on the fair value of the Company’s common stock on the date of grant.
The Company estimates the fair value of stock options with only service-based conditions and purchase rights under the ESPP on the date of grant using the Black-Scholes-Merton option-pricing model. The model requires management to make a number of assumptions, including the fair value and expected volatility of the Company’s underlying common stock price, expected life of the option, risk-free interest rate, and expected dividend yield. The fair value of the underlying stock is the fair value of the Company’s common stock on the date of grant. The expected stock price volatility assumption for the Company’s stock is determined by using a weighted average of the historical stock price volatility of comparable companies from a representative peer group, as sufficient trading history for the Company’s common stock is not available. The Company uses historical exercise information and contractual terms of options to estimate the expected term. The risk-free interest rate for periods within the expected life of the option is based on the U.S. Treasury zero coupon bonds with terms consistent with the expected term of the award at the time of grant. The expected dividend yield assumption is based on the Company’s history and expectation of no dividend payouts.
Prior to the Direct Listing, the fair value of the underlying common stock was determined using the probability weighted expected return method, with a discounted cash flow model or a market multiples method used for each expected outcome. Following the Direct Listing, the fair value of the underlying common stock is the closing price of the Company’s Class A common stock as reported on the Nasdaq Global Select Market on the grant date.
Stock-based compensation expense is recorded on a straight-line basis over the requisite service period. The Company has elected to account for forfeitures of awards as they occur, with previously recognized compensation reversed in the period that the awards are forfeited.
Income taxes
The Company accounts for income taxes using the asset and liability method whereby deferred tax asset and liability account balances are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. A valuation allowance is established when management estimates that it is more likely than not that deferred tax assets will not be realized. Realization of deferred tax assets is dependent upon future pre-tax earnings, the reversal of temporary differences between book and tax income, and the expected tax rates in future periods.
The Company is required to evaluate the tax positions taken in the course of preparing its tax returns to determine whether tax positions are more likely than not of being sustained by the applicable tax authority. Tax benefits of positions not deemed to meet the “more-likely-than-not” threshold would be recorded as a tax expense in the current year. The amount recognized is subject to estimate and management judgment with respect to the likely outcome of each uncertain tax position. The amount that is ultimately sustained for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount that is initially recognized. It is the Company’s practice to recognize interest and penalties related to income tax matters in income tax expense.
For U.S. federal tax purposes, crypto asset transactions are treated on the same tax principles as property transactions. The Company recognizes a gain or loss when crypto assets are exchanged for other property, in the amount of the difference between the fair market value of the property received and the tax basis of the exchanged crypto assets. Receipts of crypto assets in exchange for goods or services are included in taxable income at the fair market value on the date of receipt.
Net income (loss) per share
The Company computes net income (loss) per share using the two-class method required for participating securities. The two-class method requires income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. The Company’s convertible preferred stock and certain of its restricted common stock were deemed participating securities. These participating securities do not contractually require the holders of such shares to participate in the Company’s losses.
Basic net income (loss) per share is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted net income (loss) per share is computed using the weighted-average number of outstanding shares of common stock and, when dilutive, potential shares of common stock outstanding during the period. Potential shares of common stock consist of incremental shares issuable upon the assumed exercise of stock options and warrants, vesting of RSUs, vesting of restricted common stock, conversion of the Company’s convertible preferred stock and convertible notes, and settlement of contingent consideration.
Segment reporting
Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (the “CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s Chief Executive Officer is the Company’s CODM. The CODM reviews financial information presented on a global consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. While the Company does have revenue from multiple products and geographies, no measures of profitability by product or geography are available, so discrete financial information is not available for each such component. As such, the Company has determined that it operates as one operating segment and one reportable segment.
Recent accounting pronouncements
Recently adopted accounting pronouncements
On June 16, 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASU 2016-13 replaces the “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For available-for-sale debt securities, entities will be required to record allowances rather than reduce the carrying amount, as they do today under the other-than-temporary impairment model. It also simplifies the accounting model for purchased credit-impaired debt securities and loans. The Company adopted the standard on January 1, 2021 using the modified retrospective approach. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements, as the Company’s receivables are either fully collateralized or are short term in nature and therefore less susceptible to risks and uncertainty of credit losses over extended periods of time.
On August 29, 2018, the FASB issued Accounting Standards Update No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40)—Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns the accounting for implementation costs incurred in a hosting arrangement that is a service contract with the accounting for implementation costs incurred to develop or obtain internal-use software under Accounting Standards Codification (“ASC”) 350-40, in order to determine which costs to capitalize and recognize as an asset and which costs to expense. The Company adopted the standard on January 1, 2021 using the prospective transition approach. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements.
On December 18, 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes: Simplifying the Accounting for Income Taxes, as part of its overall simplification initiative to reduce the costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. Among other things, the new guidance simplifies intraperiod tax allocation and reduces the complexity in accounting for income taxes with year-to-date losses in interim periods. The Company adopted the standard on January 1, 2021. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements.
On August 5, 2020, the FASB issued Accounting Standards Update No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40) (“ASU 2020-06”). ASU 2020-06 simplifies accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity, by removing certain separation models that require the separation of a convertible debt instrument into a debt component and an equity or derivative component. ASU 2020-06 removes from U.S. GAAP the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. After adoption of ASU 2020-06 entities will not separately present in equity an embedded conversion feature in such debt. Instead entities will account for a convertible debt instrument wholly as debt, and for convertible preferred stock wholly as preferred stock (i.e., as a single unit of account), unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC 815 or (2) a convertible instrument was issued at a substantial premium. ASU 2020-06 also expands disclosure requirements for convertible instruments and simplifies areas of the guidance for diluted earnings-per-share calculations that are impacted by the amendments. Under ASU 2020-06, entities must apply the more dilutive of the if-converted method and the two-class method to all convertible instruments; the treasury stock method is no longer available. ASU 2020-06 eliminates an entity’s ability to overcome the presumption of share settlement, and as a result, the issuers of convertible debt that may be settled in any combination of cash or stock at the issuer’s option, must use the more dilutive among the if-converted method and the two-class method in computing diluted net income per share, which is typically more dilutive than the net share settlement under the treasury stock method. ASU 2020-06 is effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted. The Company early adopted ASU 2020-06 on January 1, 2021. The adoption of this new guidance did not have an impact on the Company’s consolidated financial statements since the Company had no existing convertible notes prior to issuance of the 2026 Convertible Notes, described below, in the second quarter of 2021. Further, the Company’s outstanding convertible preferred stock, which was converted into either Class A common stock or Class B common stock in conjunction with the Company’s Direct Listing, did not contain any beneficial conversion feature. The Company’s 2026 Convertible Notes are accounted for in accordance with this new guidance. See Note 11. Indebtedness for additional information.
Accounting pronouncements pending adoption
On October 28, 2021, the FASB issued Accounting Standards Update No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”). ASU 2021-08 amends ASC 805 to require acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The new standard is effective for the Company for its fiscal year beginning January 1, 2023 and interim periods within its fiscal year beginning January 1, 2023. Early adoption is permitted. The Company is evaluating the impact of adopting this standard.
v3.22.0.1
ACQUISITIONS
 12 Months Ended
Dec. 31, 2021
Business Combination and Asset Acquisition [Abstract]  
ACQUISITIONS ACQUISITIONS2021 Acquisitions
Bison Trails
On February 8, 2021, the Company completed the acquisition of Bison Trails Co. (“Bison Trails”) by acquiring all issued and outstanding common stock and stock options of Bison Trails. Bison Trails is a platform-as-a-service company that provides a suite of easy-to-use blockchain infrastructure products and services on multiple networks to custodians, exchanges and funds.
Prior to the acquisition, the Company held a minority ownership stake in Bison Trails, which was accounted for as a cost method investment. In accordance with ASC 805, Business Combinations, the acquisition was accounted for as a business combination achieved in stages under the acquisition method. Accordingly, the cost method investment was remeasured to fair value as of the acquisition date. The Company considered multiple factors in determining the fair value of the previously held cost method investment, including the price negotiated with the selling shareholders and current trading multiples for comparable companies. Based on this analysis, the Company recognized an $8.8 million gain on remeasurement, which was recorded in other expense (income), net in the consolidated statement of operations on the acquisition date.
The purchase consideration was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date with the excess recorded as goodwill, none of which is expected to be deductible for tax purposes. The goodwill balance is primarily attributed to the assembled workforce, market presence, synergies, and the use of purchased technology to develop future products and technologies.
The total consideration transferred in the acquisition was $457.3 million, consisting of the following (in thousands):
Common stock of the Company$389,314 
Previously held interest on acquisition date10,863 
Cash28,726 
Replacement of Bison Trails options28,365 
Total purchase consideration$457,268 
Included in the purchase consideration are 496,434 shares of the Company’s Class A common stock that are subject to an indemnity holdback. These shares will be released 18 months after the closing date of the transaction.
The results of operations and the fair values of the assets acquired and liabilities assumed have been included in the consolidated financial statements as of the date of acquisition. The following table summarizes the fair values of assets acquired and liabilities assumed using a cost based approach (in thousands):
Cash and cash equivalents$12,201 
Crypto assets held5,177 
Accounts and loans receivable, net of allowance2,323 
Prepaid expenses and other current assets122 
Intangible assets39,100 
Goodwill404,167 
Other non-current assets1,221 
Lease right-of-use assets808 
Total assets465,119 
Accounts payable526 
Accrued expenses and other current liabilities1,920 
Lease liabilities808 
Other non-current liabilities4,597 
Total liabilities7,851 
Net assets acquired$457,268 
The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands, except for years data):
Fair ValueUseful Life at Acquisition (in years)
Developed technology$36,000 3
In-process research and development ("IPR&D")1,200 N/A
User base1,900 3
The intangible assets will be amortized on a straight-line basis over their respective useful lives to Technology and development expenses for developed technology and General and administrative expenses for user base. Amortization of the IPR&D will be recognized in Technology and development expenses once the research and development is placed into service as internally developed software. Management applied significant judgment in determining the fair value of intangible assets, which involved the use of estimates and assumptions with respect to development costs and profit, costs to recreate customer relationships, market participation profit, and opportunity cost.
Total acquisition costs of $3.7 million were incurred related to the acquisition, which were recognized as an expense and included in General and administrative expenses in the consolidated statements of operations.
The impact of this acquisition was not considered significant to the Company’s consolidated financial statements for the current period presented and pro forma financial information has not been provided.
Other Acquisitions
During the year ended December 31, 2021, the Company also completed five other acquisitions that were not material individually, but were material when aggregated. In each of these acquisitions the Company acquired all issued and outstanding common stock and stock options of the acquiree.
The total purchase consideration in each acquisition was allocated to the tangible and intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition dates, with the excess recorded as goodwill. For each acquisition, the final allocation of purchase consideration to assets and liabilities remains in process as the Company continues to evaluate certain balances, estimates, and assumptions during the measurement period (up to one year from each acquisition’s respective acquisition date). Any changes in the fair value of the assets acquired and liabilities assumed during the measurement period may result in adjustments to goodwill.
The aggregate total preliminary consideration transferred in these acquisitions was $211.0 million, consisting of the following (in thousands):
Common stock of the Company - issued$65,717 
Common stock of the Company - to be issued58,173 
RSUs3,019 
Cash62,425 
Cash payable5,918 
Contingent consideration arrangement15,752 
Aggregate total purchase consideration$211,004 
The aggregate purchase consideration includes 160,840 shares of the Company’s Class A common stock to be issued six months after the respective acquisition date. The fair value of these shares on the acquisition date is included in Additional paid-in capital. Additionally, 51,619 shares of the Company’s Class A common stock included in the aggregate purchase consideration that were issued, or to be issued, are subject to an indemnity holdback. These shares will be released between 15 and 18 months after the closing date of each transaction.
Also included in the aggregate purchase consideration is the original estimated fair value of the contingent consideration arrangement agreed to in one of the acquisitions. The contingent consideration consists of two separate tranches. The first tranche is settled one year after the closing date and may result in delivery of up to 75,534 shares of the Company’s Class A common stock if specified revenue targets are met during the first year after the closing date. The second tranche is settled two years after the closing date and may result in delivery of up to another 75,534 shares of the Company’s Class A common stock if specified revenue targets are met during only the second year after the closing date. For each tranche, the revenue targets are adjusted for changes in the combined Bitcoin and Ethereum market capitalization since the closing date. The total number of shares of the Company’s Class A common stock issued to settle the contingent consideration arrangement would be adjusted downward in proportion to recognized revenues that do not meet the specified revenue targets.
The contingent consideration arrangement is included in Other non-current liabilities and subject to subsequent measurement at fair value with changes in fair value recognized through Other expense (income), net.
The results of operations and the provisional fair values of the assets acquired and liabilities assumed have been included in the consolidated financial statements as of the dates of acquisition of each transaction. The following table summarizes the aggregate estimated fair values of assets acquired and liabilities assumed using a cost based approach (in thousands):
Cash and cash equivalents$8,039 
Accounts receivable, net of allowance57 
Prepaid expenses and other assets276 
Intangible assets62,100 
Goodwill144,379 
Total assets214,851 
Accounts payable359 
Accrued expenses and other current liabilities983 
Other non-current liabilities2,505 
Total liabilities3,847 
Net assets acquired$211,004 
The excess of aggregate purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill of $144.4 million, of which $77.1 million is expected to be deductible for US tax purposes based on the preliminary values. The goodwill balance is primarily attributed to the assembled workforce, market presence, synergies, and the use of purchased technology to develop future products and technologies.
The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the dates of acquisition of each transaction (in thousands, except for years data):
Fair ValueUseful Life at Acquisition (in years)
Developed technology$45,900 2.5
User base1,000 2.5
In process research and development2,300 N/A
Customer relationships12,900 4.3
The intangible assets will be amortized on a straight-line basis over their respective useful lives to Technology and development expenses for developed technology and General and administrative expenses for customer relationships and user base. Amortization of the IPR&D will be recognized in Technology and development expenses once the research and development is placed into service as internally developed software. Management applied significant judgment in determining the fair value of intangible assets, which involved the use of estimates and assumptions with respect to development costs and profit, costs to recreate customer relationships, market participation profit, and opportunity cost. These valuations incorporate significant unobservable inputs classified as Level 3.
Total acquisition costs of $4.3 million were incurred related to these other acquisitions, which were recognized as expenses and included in General and administrative expenses in the consolidated statements of operations. The Company also entered into employment agreements with key employees of the acquirees, which included stock-based compensation arrangements. In conjunction with these agreements, the Company recognized $5.5 million of compensation expenses on the acquisition dates included in Technology and development expenses. Stock-based compensation arrangements offered to these key employees with vesting conditions will be recognized as compensation expense in future periods. See Note 16. Stock-Based Compensation, for additional details regarding stock-based compensation issued to employees.
The impact of these acquisitions were not considered significant to the Company’s consolidated financial statements for the current period presented and pro forma financial information has not been provided.
2020 Acquisition
Tagomi
On July 31, 2020, the Company completed the acquisition of Tagomi Holdings, Inc. (“Tagomi”), by acquiring all issued and outstanding shares of common stock and stock options of Tagomi. Tagomi is an institutional brokerage for crypto assets and offers an end-to-end brokerage solution that caters to sophisticated traders and institutions. Tagomi operates an advanced trading platform which pools liquidity from multiple venues to offer efficient pricing, algorithmic trading, a suite of prime services (including delayed settlement and borrowing and lending of fiat currency and crypto assets), and a flexible account hierarchy and operational processes that meet the needs of institutional clients.
The total consideration transferred in the acquisition was $41.8 million, consisting of the following (in thousands):
Common stock of the Company$30,589 
Replacement of Tagomi options and warrants760 
Cash1,906 
Settlement of pre-existing receivable8,537 
Total purchase consideration$41,792 
The following table summarizes the fair values of assets acquired and liabilities assumed as of the date of acquisition (in thousands):
Cash and cash equivalents$13,777 
Customer custodial funds19,837 
Crypto assets held5,687 
Accounts and loans receivable, net of allowance5,795 
Prepaid expenses and other current assets633 
Intangible assets7,350 
Goodwill22,516 
Other non-current assets1,611 
Total assets77,206 
Custodial funds due to customers20,787 
Accounts payable5,887 
Accrued expenses and other current liabilities66 
Crypto borrowings8,674 
Total liabilities35,414 
Net assets acquired$41,792 
The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill of $22.5 million, which is not deductible for tax purposes. The goodwill balance is primarily attributed to the market presence, synergies, and the use of purchased technology to develop future products and technologies.
The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands, except for years data):
Fair ValueUseful Life at Acquisition (in years)
Developed technology$6,600 3
Customer relationships400 5
Licenses350 Indefinite
The developed technology, customer relationships, and licenses represent the estimated fair value of Tagomi’s trading platform, existing relationships with customers, and money transmitter licenses held, respectively. Total acquisition costs of $1.1 million were incurred related to the acquisition, which were recognized as an expense and included in General and administrative expenses in the consolidated statements of operations.
A related party of the Company was a prior equity holder of Tagomi, and as a result of the acquisition, was entitled to receive up to 264,527 shares of the Company’s Class A common stock.
v3.22.0.1
REVENUE
 12 Months Ended
Dec. 31, 2021
Revenue from Contract with Customer [Abstract]  
REVENUE REVENUE
Revenue recognition
The Company determines revenue recognition from contracts with customers through the following steps:
•identification of the contract, or contracts, with the customer;
•identification of the performance obligations in the contract;
•determination of the transaction price;
•allocation of the transaction price to the performance obligations in the contract; and
•recognition of the revenue when, or as, the Company satisfies a performance obligation.
Revenue is recognized when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company primarily generates revenue through transaction fees charged on the platform.
The following table presents revenue of the Company disaggregated by revenue source (in thousands):
Year Ended December 31,
202120202019
Net revenue
Transaction revenue
Retail, net$6,490,992 $1,040,246 $432,919 
Institutional, net346,274 55,928 30,086 
Total transaction revenue6,837,266 1,096,174 463,005 
Subscription and services revenue
Blockchain rewards223,055 10,413 188 
Custodial fee revenue136,293 18,561 3,009 
Earn campaign revenue63,125 7,720 117 
Interest income25,835 5,535 14,414 
Other subscription and services revenue69,179 2,764 2,216 
Total subscription and services revenue517,487 44,993 19,944 
Total net revenue7,354,753 1,141,167 482,949 
Other revenue
Crypto asset sales revenue482,550 133,688 39,863 
Corporate interest and other income2,141 2,626 10,923 
Total other revenue484,691 136,314 50,786 
Total revenue$7,839,444 $1,277,481 $533,735 
Transaction revenue
Retail transaction revenue represents transaction fees earned from customers that are primarily individuals, while institutional transaction revenue represents transaction fees earned from institutional customers, such as hedge funds, family offices, principal trading firms, and financial institutions on the institutional platform.
The Company’s service is comprised of a single performance obligation to provide a crypto asset matching service when customers buy, sell, or convert crypto assets on the platform. That is, the Company is an agent in transactions between customers and presents revenue for the fees earned on a net basis.
Judgment is required in determining whether the Company is the principal or the agent in transactions between customers. The Company evaluates the presentation of revenue on a gross or net basis based on whether it controls the crypto asset provided before it is transferred to the customer (gross) or whether it acts as an agent by arranging for other customers on the platform to provide the crypto asset to the customer (net). The Company does not control the crypto asset being provided before it is transferred to the buyer, does not have inventory risk related to the crypto asset, and is not responsible for the fulfillment of the crypto asset. The Company also does not set the price for the crypto asset as the price is a market rate established by the platform. As a result, the Company acts as an agent in facilitating the ability for a customer to purchase crypto assets from another customer.
The Company considers its performance obligation satisfied, and recognizes revenue, at the point in time the transaction is processed. Contracts with customers are usually open-ended and can be terminated by either party without a termination penalty. Therefore, contracts are defined at the transaction level and do not extend beyond the service already provided.
The Company charges a fee at the transaction level. The transaction price, represented by the trading fee, is calculated based on volume and varies depending on payment type and the value of the transaction. Crypto asset purchase or sale transactions executed by a customer on the Company’s platform is based on tiered pricing that is driven primarily by transaction volume processed for a specific historical period. The Company has concluded that this volume-based pricing approach does not constitute a future material right since the discount is within a range typically offered to a class of customers with similar volume. The transaction fee is collected from the customer at the time the transaction is executed. In certain instances, the transaction fee can be collected in crypto assets, with revenue measured based on the amount of crypto assets received and the fair value of the crypto assets at the time of the transaction.
The transaction price includes estimates for reductions in revenue from transaction fee reversals that may not be recovered from customers. Such reversals occur when the customer disputes a transaction processed on their credit card or their bank account for a variety of reasons and seeks to have the charge reversed after the Company has processed the transaction. These amounts are estimated based upon the most likely amount of consideration to which the Company will be entitled. All estimates are based on historical experience and the Company’s best judgment at the time to the extent it is probable that a significant reversal of revenue recognized will not occur. All estimates of variable consideration are reassessed periodically. The total transaction price is allocated to the single performance obligation. While the Company recognizes transaction fee reversals as a reduction of net revenue, crypto asset losses related to those same transaction reversals are included in Transaction expense.
Blockchain rewards
The Company generates revenues in crypto assets through various blockchain protocols where the Company controls the staking validator address. These blockchain protocols, or the participants that form the protocol networks, reward users for performing various activities on the blockchain, such as participating in proof-of-stake networks and other consensus algorithms. The Company considers itself the principal in transactions with the blockchain networks, and therefore presents such blockchain rewards earned on a gross basis. Blockchain rewards are primarily comprised of Staking revenue in which the Company participates in networks with proof-of-stake consensus algorithms, through creating or validating blocks on the network using the staking validators that it controls. In exchange for participating in the consensus mechanism of these networks, the Company earns rewards in the form of the native token of the network. Each block creation or validation is a performance obligation. Revenue is recognized at the point when the block creation or validation is complete and the rewards are transferred into a digital wallet that the Company controls. Revenue is measured based on the number of tokens received and the fair value of the token at contract inception. Staking revenue does not include revenue from delegation services that are offered as part of Coinbase Cloud, which are included in Other subscription and services revenue.
Custodial fee revenue
The Company provides a dedicated secure cold storage solution to customers and earns a fee, which is based on a contractual percentage of the daily value of assets under custody. The fee is collected on a monthly basis. These contracts typically have one performance obligation which is provided and satisfied over the term of the contracts as customers simultaneously receive and consume the benefits of the services. The contract may be terminated by a customer at any time, without incurring a penalty. Customers are billed on the last day of the month during which services were provided, with the amounts being due within thirty days of receipt of the invoice. Amounts receivable from customers for custodial fee revenue, net of allowance, were $22.4 million and $4.4 million as of December 31, 2021 and December 31, 2020, respectively. The allowance recognized against these fees was not material for any of the periods presented.
Earn campaign revenue
The Company provides a platform for crypto asset issuers, the customer, to engage with the Company’s retail users and teach them about new crypto assets through the use of educational tools, videos, and tutorials. In exchange for completing a task, such as watching the video or downloading an application, retail users may be eligible to receive crypto assets from the crypto asset issuer. The Company is the agent with respect to the delivery of the crypto assets. The Company earns a commission from the crypto asset issuer based on the amount of crypto assets that are distributed to users.
Interest income and corporate interest and other income
The Company holds customer custodial funds and cash and cash equivalents at certain third-party banks which earn interest. The Company also earns interest income under a revenue sharing arrangement and on loans granted to retail and institutional users. Interest income is calculated using the interest method and is not within the scope of Topic 606 – Revenue from Contracts with Customers. Interest earned on customer custodial funds, revenue sharing, and loans is included in interest income within subscription and services revenue. Interest earned on cash and cash equivalents is included in corporate interest and other income, within other revenue.
Other subscription and services revenue
Other subscription and services revenue primarily includes revenue from Coinbase Cloud, which includes staking application, delegation, and infrastructure services, as well as revenue from subscription licenses. Generally, these contracts with customers contain one performance obligation, may have variable and non-cash consideration, and are satisfied at a point in time or over the period that services are provided.
Other revenue
Other revenue includes the sale of crypto assets and corporate interest and other income. Periodically, as an accommodation to customers, the Company may fulfill customer transactions using the Company’s own crypto assets held for operating purposes. The Company has custody and control of the crypto assets prior to the sale to the customer and records revenue at the point in time when the sale to the customer is processed. Accordingly, the Company records the total value of the sale in other revenue and the cost of the crypto assets in Other operating expense, net within the consolidated statements of operations. The cost of crypto assets used in fulfilling customer transactions was $436.0 million, $131.9 million and $38.6 million for the years ended December 31, 2021, 2020 and 2019, respectively.
Related party transactions
Certain of the Company’s directors, executive officers, and principal owners, including immediate family members, are users of the Company’s platform. The Company recognized revenue with related parties of $29.1 million, $3.4 million and $0.7 million for the years ended December 31, 2021, 2020 and 2019, respectively. As of December 31, 2021 and December 31, 2020, amounts receivable from related parties were $4.5 million and $0.6 million, respectively.
Revenue by geographic location
In the table below are the revenues disaggregated by geography, based on domicile of the customer or booking location, as applicable (in thousands):
Year Ended December 31,
202120202019
United States$6,339,270 $966,153 $417,260 
Rest of the World(1)
1,500,174 311,328 116,475 
Total revenue$7,839,444 $1,277,481 $533,735 
__________________
(1)No other individual country accounted for more than 10% of total revenue
v3.22.0.1
ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE
 12 Months Ended
Dec. 31, 2021
Receivables [Abstract]  
ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE
Accounts and loans receivable, net of allowance consisted of the following (in thousands):
December 31,
20212020
In-transit customer receivables$102,720 $90,571 
Trade finance receivables1,865 66,326 
Custodial fee revenue receivable23,727 4,636 
Loans receivable(1)
218,461 6,790 
Interest and other receivables73,803 23,309 
Allowance for doubtful accounts(2)
(24,551)(2,161)
Total accounts and loans receivable, net of allowance$396,025 $189,471 
__________________
(1)The fair value of collateral held as security exceeded the outstanding loans receivable as of December 31, 2021 and December 31, 2020, so no allowance was recorded.
(2)Includes provision for transaction losses of $16.8 million and $1.3 million as of December 31, 2021 and December 31, 2020, respectively.

Loans receivable
The Company grants loans to retail users and institutions. As of December 31, 2021 and December 31, 2020, the Company had granted loans with an outstanding balance of $218.5 million and $6.8 million, respectively. The related interest receivable on the loans as of December 31, 2021 and December 31, 2020, was $1.3 million and less than $0.1 million, respectively.
The amounts loaned are collateralized with the crypto assets held by the borrower in their crypto asset wallet on the Company’s platform. The Company does not have the right to use such collateral unless the borrower defaults on the loans. The Company’s credit exposure is significantly limited and no allowance was recorded against these loans receivable. Loans receivable are measured at amortized cost. The carrying value of the loans approximates their fair value. As of December 31, 2021 and December 31, 2020, there were no loans receivable past due.
ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE
Accounts and loans receivable, net of allowance consisted of the following (in thousands):
December 31,
20212020
In-transit customer receivables$102,720 $90,571 
Trade finance receivables1,865 66,326 
Custodial fee revenue receivable23,727 4,636 
Loans receivable(1)
218,461 6,790 
Interest and other receivables73,803 23,309 
Allowance for doubtful accounts(2)
(24,551)(2,161)
Total accounts and loans receivable, net of allowance$396,025 $189,471 
__________________
(1)The fair value of collateral held as security exceeded the outstanding loans receivable as of December 31, 2021 and December 31, 2020, so no allowance was recorded.
(2)Includes provision for transaction losses of $16.8 million and $1.3 million as of December 31, 2021 and December 31, 2020, respectively.

Loans receivable
The Company grants loans to retail users and institutions. As of December 31, 2021 and December 31, 2020, the Company had granted loans with an outstanding balance of $218.5 million and $6.8 million, respectively. The related interest receivable on the loans as of December 31, 2021 and December 31, 2020, was $1.3 million and less than $0.1 million, respectively.
The amounts loaned are collateralized with the crypto assets held by the borrower in their crypto asset wallet on the Company’s platform. The Company does not have the right to use such collateral unless the borrower defaults on the loans. The Company’s credit exposure is significantly limited and no allowance was recorded against these loans receivable. Loans receivable are measured at amortized cost. The carrying value of the loans approximates their fair value. As of December 31, 2021 and December 31, 2020, there were no loans receivable past due.
v3.22.0.1
LEASES
 12 Months Ended
Dec. 31, 2021
Leases [Abstract]  
LEASES LEASES
The Company has operating leases for corporate offices. The leases have remaining lease terms of less than one year to five years. The leases generally contain options to extend or terminate the lease. However, these were not included in determining the lease terms as the Company is not reasonably certain to exercise those options. The Company rents or subleases certain of these corporate offices to third parties. The Company recognized sublease income of $6.7 million, $6.6 million and $2.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. The remaining terms of these subleases range from ten months to three years.
The components of lease cost were as follows (in thousands):
Year Ended December 31,
202120202019
Operating lease cost$34,074$30,231 $17,421 
Short-term lease cost374358 3,031 
Total lease cost$34,448 $30,589 $20,452 
Other information related to leases was as follows as of:
December 31,
20212020
Weighted-average remaining lease term (in years)2.04.1
Weighted-average discount rate3.02 %4.62 %
The interest rate used to determine the present value of the future lease payments is the Company’s incremental borrowing rate because the interest rate implicit in the leases is not readily determinable. The Company’s incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located.
Maturities of lease liabilities were as follows (in thousands):
2022$36,268 
202335,266 
202432,630 
20259,036 
2026792 
Thereafter— 
Total lease payments113,992 
Less imputed interest(7,548)
Total$106,444 
430 California office space
In September 2020, the Company renegotiated the terms of its office space lease in San Francisco, California, which included a partial give back of space for which the lease had not yet commenced. The terms of the agreement provided that the Company would pay a cancellation fee of $7.9 million and commit to enter into leases at the lessor’s other properties, with a minimum committed spend of $15.5 million spread over the period from September 2020 to December 31, 2025.
v3.22.0.1
PROPERTY AND EQUIPMENT, NET
 12 Months Ended
Dec. 31, 2021
Property, Plant and Equipment [Abstract]  
PROPERTY AND EQUIPMENT, NET PROPERTY AND EQUIPMENT, NET
Property and equipment consisted of the following (in thousands):
December 31,
20212020
Furniture and fixtures$7,307 $7,161 
Construction in progress535 358 
Computers and equipment3,542 2,815 
Leasehold improvements43,048 40,589 
Capitalized software47,044 22,815 
Total cost101,476 73,738 
Accumulated depreciation and amortization(42,246)(24,488)
Total, net$59,230 $49,250 
Depreciation and amortization expense was $18.4 million, $14.3 million, and $7.2 million for the years ended December 31, 2021, 2020 and 2019, respectively. Total additions to capitalized software were $22.2 million, $12.1 million and $9.5 million for the years ended December 31, 2021, 2020 and 2019, respectively.
Long-lived assets, which consisted of property and equipment, net and operating lease ROU assets, by geography were as follows (in thousands):
December 31,
20212020
United States$145,203 $148,199 
Rest of the World(1)
12,412 1,896 
Total long-lived assets$157,615 $150,095 
________________
(1)No other individual country accounted for more than 10% of total long-lived assets.
v3.22.0.1
GOODWILL AND INTANGIBLE ASSETS, NET
 12 Months Ended
Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL AND INTANGIBLE ASSETS, NET GOODWILL AND INTANGIBLE ASSETS, NET
Goodwill
The following table reflects the changes in the carrying amount of goodwill (in thousands):
Year Ended December 31,
20212020
Balance, beginning of period$77,212 $54,696 
Additions due to business combinations548,546 22,516 
Balance, end of period$625,758 $77,212 
There was no impairment recognized against goodwill at the beginning or end of the periods presented.
Intangible assets
Intangible assets consisted of the following (in thousands, except years data):
As of December 31, 2021Gross Carrying AmountAccumulated AmortizationIntangible Assets, NetWeighted Average Remaining Useful Life (in years)
Amortizing intangible assets
Acquired developed technology$100,908 $(34,865)$66,043 1.97
User base2,997 (1,020)1,977 1.75
Customer relationships79,491 (27,789)51,702 3.68
Non-compete agreement2,402 (1,161)1,241 2.58
Assembled workforce60,800 (8,324)52,476 1.43
In-process research and development(1)
3,000 — 3,000 N/A
Indefinite-lived intangible assets
Domain name250 — 250 N/A
Crypto assets held(2)
988,193 — 988,193 N/A
Total$1,238,041 $(73,159)$1,164,882 
________________
(1)Amortization begins once the technology is placed in service. IPR&D is expected to have a useful life of three years.
(2)Crypto assets held as of December 31, 2021 includes $38.1 million of crypto assets loaned to customers under the trade finance receivables settlement arrangements as these did not meet the criteria for derecognition.
As of December 31, 2020Gross Carrying AmountAccumulated AmortizationIntangible Assets, NetWeighted Average Remaining Useful Life (in years)
Amortizing intangible assets
Acquired developed technology$20,708 $(13,024)$7,684 2.09
Customer relationships66,591 (15,771)50,820 4.58
Trade name30 (30)— 0
Non-compete agreement2,402 (681)1,721 3.58
Indefinite-lived intangible assets
Domain name250 — 250 N/A
Licenses350 — 350 N/A
Crypto assets held316,094 — 316,094 N/A
Total$406,425 $(29,506)$376,919 
Amortization expense of intangible assets was $45.3 million, $16.7 million and $9.7 million for the years ended December 31, 2021, 2020 and 2019, respectively. The Company estimates that there is no significant residual value related to its amortizing intangible assets. During the years ended December 31, 2021, 2020 and 2019, the Company recorded impairment charges of $0.5 million, $0 and $1.6 million, respectively, related to its intangible assets, excluding crypto assets held. Impairment expense is included in Other operating expense, net in the consolidated statements of operations.
Crypto assets held are accounted for as an indefinite-lived intangible asset. Thus, unless they are designated as hedged items in fair value hedges, crypto assets are recognized at cost and subject to impairment losses if the fair value of crypto assets decreases below the carrying value at any time during the period. Impairment losses cannot be recovered for any subsequent increase in fair value until the sale or disposal of the asset. The Company recorded gross impairment charges of $329.2 million, $8.4 million and $0.7 million during the years ended December 31, 2021, 2020 and 2019, respectively, due to the observed market price of crypto assets decreasing below the carrying value at some point during the period. The Company partially recovered impairments recorded during the period through both subsequent crypto asset sales and disposals. Impairment charges of $119.4 million relate to the crypto assets still held as of December 31, 2021. Impairment expense is included in Other operating expense, net in the consolidated statements of operations.
Crypto assets borrowed that have been designated as hedged items in fair value hedges are initially measured at cost. Subsequent changes in fair value attributable to the hedged risk are adjusted to the carrying amount of these crypto assets, with changes in fair value recorded in Other operating expense, net in the consolidated statements of operations. See Note 12. Derivatives, for additional details regarding crypto assets designated as hedged items in fair value hedges.
Crypto assets held consisted of the following (in thousands):
December 31,
20212020
Crypto assets held as investments$209,415 $24,438 
Crypto assets held for operating purposes357,093 37,830 
Crypto assets borrowed421,685 253,826 
Total crypto assets held
$988,193 $316,094 
See Note 13. Fair Value Measurements, for additional details regarding the carrying value of the Company’s crypto assets held.
The expected future amortization expense for intangible assets other than IPR&D as of December 31, 2021 is as follows (in thousands):
2022$88,982 
202358,034 
202414,591 
20259,694 
20262,138 
Thereafter— 
Total expected future amortization expense$173,439 
v3.22.0.1
PREPAID EXPENSES AND OTHER ASSETS
 12 Months Ended
Dec. 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
PREPAID EXPENSES AND OTHER ASSETS PREPAID EXPENSES AND OTHER ASSETS
Prepaid expenses and other current assets and other non-current assets consisted of the following (in thousands):
December 31,
20212020
Prepaid expenses and other current assets
Prepaid expenses$123,246 $36,218 
Warrant to purchase crypto assets— 2,575 
Deposits9,658 — 
Other2,945 717 
Total prepaid expenses and other current assets$135,849 $39,510 
Other non-current assets
Equity method investments$1,463 $2,000 
Strategic investments363,950 26,146 
Deferred tax assets573,547 20,807 
Deposits13,347 68,287 
Total other non-current assets$952,307 $117,240 
Strategic investments
The Company makes strategic investments in various companies and technologies through Coinbase Ventures, the Company’s venture capital arm. Strategic investments primarily include equity investments in privately held companies without readily determinable fair values where the Company (1) holds less than 20% ownership in the entity, and (2) does not exercise significant influence. These investments are recorded at cost and adjusted for observable transactions for same or similar investments of the same issuer (referred to as the measurement alternative) and impairment. The components of strategic investments accounted for under the measurement alternative included in the table above are presented below (in thousands):
December 31,
20212020
Carrying amount, beginning of period$26,146 $15,599 
Net additions(1)
320,316 9,687 
Upward adjustments8,019 1,307 
Previously held interest in Bison Trails (see Note 3)(2,000)— 
Impairments and downward adjustments(50)(447)
Carrying amount, end of period(2)
$352,431 $26,146 
________________
(1)Net additions include additions from purchases and reductions due to exits of securities and reclassifications due to changes to capital structure.
(2)Excludes $11.5 million of strategic investments that are not accounted for under the measurement alternative.
Upward adjustments, impairments, and downward adjustments from remeasurement of investments are included in Other expense (income), net in the consolidated statements of operations. As of December 31, 2021, cumulative upward adjustments were $4.6 million and cumulative impairments and downward adjustments were $0.5 million. As of December 31, 2020, cumulative upward adjustments and impairments and downward adjustments were $1.6 million and $0.5 million, respectively.
During the year ended December 31, 2021, the Company invested an aggregate of $203.1 million in investees in which certain related parties of the Company held an interest over 10%. During the year ended December 31, 2020, the Company invested an aggregate of $0.5 million in investees of which certain related parties of the Company held an interest over 10%.
v3.22.0.1
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
 12 Months Ended
Dec. 31, 2021
Payables and Accruals [Abstract]  
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accrued expenses and other current liabilities consisted of the following (in thousands):
December 31,
20212020
Accrued expenses$195,810 $33,987 
Accrued payroll and payroll related146,313 23,403 
Income taxes payable4,553 5,805 
Other payables92,883 25,588 
Total accrued expenses and other current liabilities$439,559 $88,783 
v3.22.0.1
INDEBTEDNESS
 12 Months Ended
Dec. 31, 2021
Debt Disclosure [Abstract]  
INDEBTEDNESS INDEBTEDNESS
Convertible Senior Notes
In May 2021, the Company issued an aggregate principal amount of $1.44 billion of convertible senior notes due in 2026 (the “2026 Convertible Notes”) pursuant to an indenture, dated May 18, 2021 (the “Convertible Notes Indenture”), between the Company and U.S. Bank National Association, as trustee. The 2026 Convertible Notes were offered and sold in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).
The 2026 Convertible Notes are senior unsecured obligations of the Company and bear interest at a rate of 0.5% per year payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2021. The 2026 Convertible Notes mature on June 1, 2026, unless earlier converted, redeemed or repurchased. The proceeds received of $1.42 billion were net of a 1% original issue discount.
The initial conversion rate and conversion rate as of December 31, 2021 for the 2026 Convertible Notes is 2.6994 shares of the Company's Class A common stock per $1,000 principal amount of 2026 Convertible Notes, which is equivalent to an initial conversion price of approximately $370.45 per share of the Class A common stock. The conversion rate and conversion price are subject to customary adjustments under certain circumstances in accordance with the terms of the Convertible Notes Indenture.
The 2026 Convertible Notes will be convertible at the option of the holders before December 1, 2025 only upon the occurrence of certain events, and from and after December 1, 2025, at any time at their election until the close of business on the second scheduled trading day immediately preceding June 1, 2026, only under certain circumstances. Upon conversion, the Company may satisfy its conversion obligation by paying or delivering, as applicable, cash, shares of the Company’s Class A common stock or a combination of cash and shares of the Company’s Class A common stock, at the Company’s election, based on the applicable conversion rate. In addition, if certain corporate events that constitute a make-whole fundamental change (as defined in the Convertible Notes Indenture) occur, then the conversion rate will, in certain circumstances, be increased for a specified period of time. Additionally, in the event of a corporate event constituting a fundamental change (as defined in the Convertible Notes Indenture), holders of the 2026 Convertible Notes may require the Company to repurchase all or a portion of their 2026 Convertible Notes at a repurchase price equal to 100% of the principal amount of the 2026 Convertible Notes being repurchased, plus accrued and unpaid special interest or additional interest, if any, to, but excluding, the date of the fundamental change repurchase.
The Company accounted for the 2026 Convertible Notes wholly as debt because (1) the conversion features do not require bifurcation as a derivative under ASC 815 and (2) the 2026 Convertible Notes were not issued at a substantial premium.
Discounts on the 2026 Convertible Notes reflect a 1% original issue discount of $14.4 million and debt issuance costs related to the 2026 Convertible Notes of $19.4 million, which include commissions payable to the initial purchasers and third-party offering costs. As of December 31, 2021, the outstanding aggregate principal balance of the 2026 Convertible Notes and the related unamortized discounts were $1.44 billion and $29.4 million, respectively.
Capped Calls
On May 18, 2021, in connection with the pricing of the 2026 Convertible Notes, the Company entered into privately negotiated capped call transactions (the “Capped Calls”) with certain financial institutions (the "option counterparties") at a cost of $90.1 million. The Capped Calls cover, subject to customary adjustments, the number of shares of the Company’s Class A common stock initially underlying the 2026 Convertible Notes. By entering into the Capped Calls, the Company expects to reduce the potential dilution to its Class A common stock (or, in the event a conversion of the 2026 Convertible Notes is settled in cash, to reduce its cash payment obligation) in the event that at the time of conversion of the 2026 Convertible Notes its Class A common stock price exceeds the conversion price of the 2026 Convertible Notes. The Capped Calls have an initial strike price of approximately $370.45 per share of Class A common stock and an initial cap price of approximately $478.00 per share of Class A common stock.
The Capped Calls meet the criteria for classification in equity, are not remeasured each reporting period and are included as a reduction to Additional paid-in capital within stockholders’ equity.
Senior Notes
In September 2021, the Company completed the issuance of an aggregate principal amount of $1.0 billion of Senior Notes due on October 1, 2028 (the “2028 Senior Notes”) and an aggregate principal amount of $1.0 billion of Senior Notes due on October 1, 2031 (the “2031 Senior Notes” and together with the 2028 Senior Notes, the “Senior Notes”). The Senior Notes were issued within the United States only to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A under the Securities Act, and outside the United States to non-U.S. persons pursuant to Regulation S under the Securities Act. The Company issued the Senior Notes at par and paid approximately $24.0 million in total debt issuance costs, which includes commissions payable to the initial purchasers and third-party offering costs. Interest on the Senior Notes is payable semi-annually in arrears on April 1 and October 1 of each year, beginning on April 2022 at 3.375% per annum for the 2028 Senior Notes and 3.625% per annum for the 2031 Notes. The entire principal amount of the Senior Notes is due at the time of maturity, unless repurchased or redeemed at an earlier date. The Senior Notes were issued pursuant to an indenture, dated September 17, 2021 (the “Senior Notes Indenture”), among the Company, the Guarantor (as defined below) and U.S. Bank National Association, as trustee.
The Senior Notes are redeemable at the Company’s discretion, in whole or in part, at any time. If redeemed prior to October 1, 2024 for the 2028 Senior Notes and October 1, 2026 for the 2031 Senior Notes, the redemption price is subject to a make-whole premium calculated by reference to then-current U.S. Treasury rates plus a fixed spread, plus any accrued and unpaid interest. If redeemed on or after those respective dates, the make-whole premium does not apply.
In addition, prior to October 1, 2024, the Company may redeem up to 40% of the aggregate principal amount of the Senior Notes with net cash proceeds from certain equity offerings at a redemption price equal to 103.375% of the principal amount of the 2028 Senior Notes to be redeemed and 103.625% of the principal amount of the 2031 Senior Notes to be redeemed, in each case, plus any accrued and unpaid interest. Upon the occurrence of a change of control triggering event (as defined in the Senior Notes Indenture), the Company must offer to repurchase each series of Senior Notes at a repurchase price equal to 101% of the principal amount of the Senior Notes to be repurchased, plus any accrued and unpaid interest, to, but excluding, the applicable repurchase date.
The Senior Notes are guaranteed by one of the Company’s domestic subsidiaries, Coinbase, Inc. (the “Guarantor”). Further, the indenture governing the Senior Notes contains customary covenants that restrict the ability of the Company and certain of its subsidiaries to incur debt and incur liens. The Company is not aware of any instances of any non-compliance with the covenants as of December 31, 2021.
As of December 31, 2021, the outstanding aggregate principal balance of the 2028 Senior Notes and the related unamortized discounts were $1.0 billion and $11.6 million, respectively. As of December 31, 2021, the outstanding aggregate principal balance of the 2031 Senior Notes and the related unamortized discounts were $1.0 billion and $11.7 million, respectively.
Interest
The following table summarizes the 2026 Convertible Notes, the 2028 Senior Notes and the 2031 Senior Notes (in thousands, except percentages):
Year Ended December 31, 2021
IndebtednessEffective interest rateCoupon interest expenseAmortization of debt discounts and debt issuance costsTotal interest expense
2026 Convertible Notes0.98 %$4,230 $4,311 $8,541 
2028 Senior Notes3.57 %9,732 435 10,167 
2031 Senior Notes3.77 %10,167 285 10,452 
Total$24,129 $5,031 $29,160 
Discounts are amortized to interest expense using the effective interest method over the contractual term of the respective note. Interest expense is included in Other expense (income), net in the consolidated statements of operations.
v3.22.0.1
DERIVATIVES
 12 Months Ended
Dec. 31, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
DERIVATIVES DERIVATIVES
The Company’s crypto asset borrowings are accounted for as hybrid instruments, with a liability host contract that contains an embedded derivative based on the changes in the fair value of the underlying crypto asset. The host contract is not accounted for as a debt instrument because it is not a financial liability. The embedded derivative is accounted for at fair value, with changes in fair value recognized in Other operating expense, net in the consolidated statements of operations. The liability host contracts and embedded derivatives are included in Crypto asset borrowings in the consolidated balance sheets.
For risk management purposes, the Company applies hedge accounting using the embedded derivatives in qualifying fair value hedges to primarily hedge the fair value exposure of crypto asset prices. For qualifying fair value hedges, the changes in the fair value of the derivative and the fair value of the hedged item, the crypto assets, are recognized in current-period earnings in Other operating expense, net in the consolidated statements of operations. Derivative amounts affecting earnings are recognized in the same line item as the earnings effect of the hedged item.
During the year ended December 31, 2021, the Company provided services for which, under the contract, the customer pays in crypto assets. The amount of crypto assets are fixed at the time of invoicing. The right to receive fixed amounts of crypto assets consists of a receivable host contract and an embedded forward contract to purchase crypto assets. The host contract is initially measured based on the fair value of the crypto assets at contract inception, along with an embedded derivative with an initial fair value of zero. The embedded derivative is subsequently measured at fair value, with changes in fair value recognized in Other operating expense, net in the consolidated statements of operations. The receivable host contract and embedded derivative are included in Accounts and loans receivable, net of allowance in the consolidated balance sheets.
During the year ended December 31, 2020, the Company also entered into a warrant to purchase crypto assets from the respective crypto asset issuer. This contract was accounted for as a derivative at fair value, with changes in fair value recognized in Other operating expense, net in the consolidated statements of operations. The warrant was included in Prepaid expenses and other current assets in the consolidated balance sheet. The warrant was exercised in 2021.
Notional amount of derivative contracts
The following table summarizes the notional amount of derivative contracts outstanding, in native units.
December 31,
20212020
Crypto asset borrowings with embedded derivatives:
BTC8,001 9,305 
ETH10,506 3,000 
ICP750,000 —
XRP— 1,500,000 
Warrant to purchase crypto assets:
UNI— 800,000 
The following tables summarize information on derivative assets and liabilities that are reflected in the consolidated balance sheets, by accounting designation (in thousands):
Gross derivative assetsGross derivative liabilities
December 31, 2021Not designated as hedgesDesignated as hedgesTotal derivative assetsNot designated as hedgesDesignated as hedgesTotal derivative liabilities
Crypto asset borrowings with embedded derivatives$— $336,396 $336,396 $— $93,616 $93,616 
Accounts receivable denominated in crypto assets9,033 — 9,033 — — — 
Total fair value of derivative assets and liabilities$9,033 $336,396 $345,429 $— $93,616 $93,616 
Gross derivative assetsGross derivative liabilities
December 31, 2020Not designated as hedgesDesignated as hedgesTotal derivative assetsNot designated as hedgesDesignated as hedgesTotal derivative liabilities
Crypto asset borrowings with embedded derivatives$— $— $— $12,696 $114,395 $127,091 
Warrant to purchase crypto assets2,575 — 2,575 — — — 
Total fair value of derivative assets and liabilities$2,575 $— $2,575 $12,696 $114,395 $127,091 
Fair value hedge gains and losses
The following table presents derivative instruments used in fair value hedge accounting relationships, as well as pre-tax gains (losses) recorded on such derivatives and the related hedged items (in thousands):
Gains (losses) recorded in income
Year ended December 31, 2021Year ended December 31, 2020
DerivativesHedged itemsIncome statement impactDerivativesHedged itemsIncome statement impact
Crypto asset borrowings with embedded derivatives$87,730 $(70,577)$17,153 $(114,395)$113,102 $(1,293)
The following amounts were recorded in the consolidated balance sheets related to certain cumulative fair value hedge basis adjustments that are expected to reverse through the consolidated statements of operations in future periods as an adjustment to Other operating expense, net (in thousands):
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items
December 31, 2021Carrying amount of the hedged itemsActive hedging relationshipsDiscontinued hedging relationshipsTotal
Crypto assets held$421,685 $(240,771)$— $(240,771)
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items
December 31, 2020Carrying amount of the hedged itemsActive hedging relationshipsDiscontinued hedging relationshipsTotal
Crypto assets held$247,735 $113,102 $— $113,102 
Crypto asset borrowings
The carrying value of the outstanding host contracts as of December 31, 2021 and December 31, 2020 was $669.4 million and $144.2 million, respectively. The fair value of the embedded derivative assets and liabilities as of December 31, 2021 was $336.4 million and $93.6 million, respectively. The fair value of the embedded derivative assets and liabilities as of December 31, 2020 was $0 and $127.1 million, respectively. Of the outstanding host contracts and embedded derivative liabilities, as of December 31, 2021, $1.3 million and $0.5 million were due to a related party, respectively.
During the year ended December 31, 2021 and December 31, 2020, the fees on these borrowings ranged from 0.0% to 10.0% and 1.7% to 10.0%, respectively. During the year ended December 31, 2021 and December 31, 2020, the Company incurred $11.8 million and $2.6 million of borrowing fees in crypto assets, respectively. These borrowing fees are included in Other operating expense, net in the consolidated statements of operations.
v3.22.0.1
FAIR VALUE MEASUREMENTS
 12 Months Ended
Dec. 31, 2021
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities measured and recorded at fair value on a recurring basis (in thousands):
December 31, 2021December 31, 2020
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash and cash equivalents(1)
$4,813,621 $— $— $4,813,621 $212,818 $— $— $212,818 
Customer custodial funds(2)
3,566,072 — — 3,566,072 1,171,274 — — 1,171,274 
Crypto assets held(3)
— 421,685 — 421,685 — 247,735 — 247,735 
Derivative assets(4)(5)
— 345,429 — 345,429 — — 2,575 2,575 
Total assets$8,379,693 $767,114 $— $9,146,807 $1,384,092 $247,735 $2,575 $1,634,402 
Liabilities
Derivative liabilities(5)
$— $93,616 $— $93,616 $— $127,091 $— $127,091 
Contingent consideration arrangement— — 14,828 14,828 — — — — 
Total liabilities$— $93,616 $14,828 $108,444 $— $127,091 $— $127,091 
__________________
(1)Excludes corporate cash of $2.3 billion and $849.0 million held in deposit at financial institutions and crypto asset trading venues and not measured and recorded at fair value as of December 31, 2021 and December 31, 2020, respectively.
(2)Excludes customer custodial funds of $7.0 billion and $2.6 billion held in deposit at financial institutions and not measured and recorded at fair value as of December 31, 2021 and December 31, 2020, respectively.
(3)Includes crypto assets held that have been designated as hedged items in fair value hedges and excludes crypto assets of $566.5 million and $68.4 million held at cost as of December 31, 2021 and December 31, 2020, respectively.
(4)Level 3 derivative assets represent a warrant to purchase crypto assets, which are included in Prepaid expenses and other current assets in the consolidated balance sheets.
(5)Excludes crypto asset borrowings of $669.4 million and $144.2 million, representing the host liability contract which is not measured and recorded at fair value as of December 31, 2021 and December 31, 2020, respectively. Additionally, excludes the host contract of $17.4 million related to accounts receivable denominated in crypto assets as of December 31, 2021.

The Company did not make any transfers between the levels of the fair value hierarchy during the years ended December 31, 2021 and December 31, 2020.
Level 3 derivative asset
The following table presents a reconciliation of the derivative asset measured at fair value on a recurring basis using significant unobservable inputs (in thousands):
Year Ended December 31,
20212020
Balance, beginning of period$2,575$—
Change in fair value14,7572,575
Exercise of warrant(17,332)—
Balance, end of period$—$2,575
The derivative asset balance was included in Prepaid expenses and other current assets in the consolidated balance sheet. The derivative asset was represented by a warrant agreement to purchase crypto assets from asset issuers. Upon exercise of the warrant, the underlying crypto assets were subject to transfer and sale restrictions, and vested over periods of between one to four years. The fair value of the warrant was based on the number of crypto assets to be received upon exercise, the fair value of the crypto assets, and a discount for lack of marketability due to the underlying restriction on the crypto assets. The discount for lack of marketability was estimated using the Finnerty and Asian put option models. The fair value adjustments were included in Other operating expense, net in the consolidated statements of operations. The following significant unobservable inputs were used:
Year Ended December 31,
20212020
Discount rate
0.01% - 0.15%
0.07% - 0.12%
Historical volatility of comparable crypto assets
105% - 175%
90% - 125%
Level 3 contingent consideration arrangement liability
The following table presents a reconciliation of the contingent consideration arrangement measured at fair value on a recurring basis using significant unobservable inputs (in thousands):
Year Ended December 31,
20212020
Balance, beginning of period$—$12,924
Fair value recorded in connection with acquisition15,752—
Change in fair value(924)3,281
Settlement—(16,205)
Balance, end of period$14,828$—
On August 27, 2020, the Company issued 690,756 shares of its Class A common stock to settle a certain contingent consideration arrangement pursuant to the terms of the arrangement.
The Company’s contingent consideration arrangements were included in Other non-current liabilities and changes in fair value are recognized through Other expense (income), net.
During the year ended December 31, 2021, the estimated fair value of the contingent consideration arrangement was determined using the Monte Carlo simulation method and applying a risk-adjusted discount rate to the expected payoff on each of the settlement dates. The expected payoff was determined by forecasting revenues for the acquired entity and simulating changes to the price of the Company’s Class A common stock, as well as BTC and ETH market capitalization, using a risk-neutral Geometric Brownian Motion path. The simulations also utilized the estimated volatility of and correlation between these variables. During the year ended December 31, 2020, the fair value of the contingent consideration arrangement was based on the fair value of the number of shares of the Company’s Class A common stock that were expected to be issued. The fair value of the contingent consideration was based on significant inputs not observable in the market and as such, incorporates Level 3 inputs. The following significant unobservable inputs were used:
Year Ended December 31,
20212020
Discount rate30.0 %17.5 %
Volatility of forecasted revenues146.1 %N/A
Long-term growth rateN/A3.0 %
Revenue growth rateN/A
3% - 61%
Assets and liabilities measured and recorded at fair value on a non-recurring basis
The Company’s non-financial assets, such as goodwill, intangible assets, property and equipment, and crypto assets held but not designated in hedging relationships are adjusted to fair value when an impairment charge is recognized. The Company’s strategic investments are also measured at fair value on a non-recurring basis. Such fair value measurements are based predominantly on Level 3 inputs. Fair value of crypto assets held are predominantly based on Level 2 inputs.
Financial assets and liabilities not measured and recorded at fair value
The Company’s financial instruments, including cash, restricted cash, certain customer custodial funds, USDC, and custodial funds due to customers are classified as Level 1 and carried at amortized cost, which approximates their fair value. The loans receivable are classified as Level 3 and are carried at amortized cost, which approximates their fair value.
The Company estimates the fair value of its 2026 Convertible Notes and Senior Notes based on quoted prices in markets that are not active, which is considered a Level 2 valuation input. As of December 31, 2021, the estimated fair value of the 2026 Convertible Notes and Senior Notes were $1.54 billion and $1.86 billion, respectively.
v3.22.0.1
CONVERTIBLE PREFERRED STOCK
 12 Months Ended
Dec. 31, 2021
Temporary Equity Disclosure [Abstract]  
CONVERTIBLE PREFERRED STOCK CONVERTIBLE PREFERRED STOCK
On April 1, 2021, in anticipation of the Direct Listing and following a vote by the requisite holders of the convertible preferred stock, all outstanding shares of the Company’s convertible preferred stock were converted into 8,556,952 shares of the Company’s Class A common stock and 103,850,006 shares of the Company’s Class B common stock. Effective immediately following the conversion, the Company amended and restated its certificate of incorporation (the “Restated Certificate of Incorporation”) to authorize 500,000,000 shares of undesignated preferred stock. See Note 15. Common Stock for additional details. The Company’s board of directors (the “Board”) has the authority to determine the price, rights, preferences, privileges and restrictions, including voting rights, of those shares without any further vote or action by the stockholders.
As of December 31, 2021, there were no shares of convertible preferred stock issued and outstanding.
A summary of the Company’s authorized, issued, and outstanding shares of convertible preferred stock as of December 31, 2020, is presented in the following table (in thousands, except per share data).
As of December 31, 2020
Shares AuthorizedShares Issued and OutstandingOriginal Issue Price per ShareLiquidation PreferenceCarrying Value
FF Preferred5,739 5,739 $— $— $11 
Series A30,929 27,349 0.19721 5,394 4,946 
Series B25,416 21,831 1.00676 21,978 19,228 
Series C32,542 31,656 2.76488 87,525 83,146 
Series D17,471 17,471 8.25390 144,205 135,738 
Series E14,508 8,832 36.19220 319,648 319,398 
126,605 112,878 $578,750 $562,467 
The change in the number of outstanding shares of convertible preferred stock per class was as follows (in thousands):
Series FFSeries ASeries BSeries CSeries DSeries E
Balance at January 1, 20215,739 27,349 21,831 31,656 17,471 8,832 
Conversion to Class A common stock— (117)— (36)(43)(8,832)
Conversion to Class B common stock(5,739)(27,232)(21,831)(31,620)(17,428)— 
Balance at December 31, 2021— — — — — — 
During the years ended December 31, 2021 and December 31, 2020, there were sales of convertible preferred stock between stockholders. Pursuant to the terms of sale of the convertible preferred stock, those preferred shares converted to Class A common stock. The Company did not sell any shares or receive any proceeds from the transactions.
The holders of FF Preferred and Series A, Series B, Series C, Series D, and Series E convertible preferred stock had certain rights, preferences and privileges as follows:
Voting rights
The holders of FF Preferred and Series A, Series B, Series C, Series D, and Series E convertible preferred stock were subject to the Company’s amended and restated voting agreement and were entitled to the number of votes equal to the voting power of the number of shares of common stock into which their shares of convertible preferred stock could be directly converted with FF Preferred and Series A, Series B, Series C, and Series D convertible preferred stock converting into Class B common stock entitled to ten votes per share and Series E convertible preferred stock converting into Class A common stock entitled to one vote per share. The holders of Series A convertible preferred stock had a right to elect one member of the Board and holders of Series C convertible preferred stock had a right to elect one member of the Board.
Dividends
The holders of Series A, Series B, Series C, Series D, and Series E convertible preferred stock, prior and in preference to holders of FF Preferred, Class A common stock, or Class B common stock, were entitled to receive dividends on a pari passu basis at the rate of 6% of the respective original issue price per annum on each outstanding share.
The dividends were non-cumulative and were payable when, as and if declared by the Board. After payment of such dividends to holders of Series A, Series B, Series C, Series D, and Series E convertible preferred stock, any additional dividends were required to be distributed to holders of all classes of stock on a pro rata basis, based on the number of shares of Class A common stock and Class B common stock held by each holder (assuming conversion of all shares of convertible preferred stock into shares of common stock). As of December 31, 2021, no dividends had been declared or paid.
Liquidation rights
In the event of any liquidation event of the Company (a voluntary or involuntary liquidation, a merger where the holders of common stock and convertible preferred stock own less than a majority of the resulting voting power of the surviving entity, or a sale of substantially all the assets of the Company), before any distribution or payment was required to be made to the holders of FF Preferred, Class A common stock, or Class B common stock, the holders of Series A, Series B, Series C, Series D, and Series E convertible preferred stock were entitled to receive out of the assets legally available for distribution, liquidating distributions in the amount of the greater of (a) the original per share purchase prices of $0.19721 for Series A convertible preferred stock, $1.00676 for Series B convertible preferred stock, $2.76488 for Series C convertible preferred stock, $8.2539 for Series D convertible preferred stock, and $36.1922 for Series E convertible preferred stock, plus all declared but unpaid dividends or (b) an amount per share as would have been payable had each share of convertible preferred stock converted into Class A common stock or Class B common stock, as applicable, immediately prior to the liquidation event.
If liquidation proceeds were insufficient to permit payment to the stockholders of convertible preferred stock of their preferential amount, then all liquidation proceeds were required to be distributed with equal priority, on a pro-rata basis, among the holders of the Series A, Series B, Series C, Series D, and Series E convertible preferred stock in proportion to their liquidation preference. After payment of all preferential amounts required to be paid to the holders of Series A, Series B, Series C, Series D, and Series E convertible preferred stock, the remaining assets available for distribution were required to be distributed among the holders of FF Preferred, the Class A common stock, and Class B common stock on a pro-rata basis, based on the number of shares held by each holder.
As the shares of convertible preferred stock contained liquidation features that were not solely within the Company’s control, these liquidation features resulted in the Series FF, Series A, Series B, Series C, Series D, and Series E convertible preferred stock being classified as mezzanine equity rather than as a component of stockholders’ equity.
Conversion
Each share of FF Preferred was convertible, at the option of the holder, at any time after the date of issuance according to a conversion ratio, initially $1.00, subject to adjustments for stock splits, stock dividends, and dilution.
If a share of FF Preferred was purchased by an investor in connection with an equity financing, each such share of stock transferred to the investor was required to automatically convert into shares of a subsequent series of convertible preferred stock. If a transfer of shares was neither made in connection with an equity financing or authorized by a majority of the Board, the FF Preferred was required to automatically convert into such number of shares of Class B common stock.
In the event the Company at any time after the original issue date of Series A, Series B, Series C, Series D, and Series E convertible preferred stock issued additional shares of capital stock without consideration or for consideration per share less than the Series A conversion price, Series B conversion price, Series C conversion price, Series D conversion price, or Series E conversion price, as applicable, then the conversion price of the above mentioned convertible preferred stock was required to be adjusted (subject to certain customary exceptions).
Each share of FF Preferred and Series A, Series B, Series C, and Series D convertible preferred stock was required to automatically convert into that number of shares of Class B common stock and each share of Series E convertible preferred stock was required to automatically convert into that number of shares of Class A common stock determined in accordance with the conversion ratio on the earlier of (i) the closing of an underwritten public offering of Class A common stock under the Securities Act, in which the Company received at least $100 million in aggregate net proceeds or (ii) (a) with respect to Series A, Series B, Series C, Series D, and Series E convertible preferred stock, the written request from the holders of at least a majority of the then outstanding shares of convertible preferred stock, each voting exclusively and as a separate class and voting together as a single class on an as-converted basis and (b) with respect to FF Preferred, the written request from the holders of at least a majority of the then outstanding shares of FF Preferred, voting exclusively and as a separate class.
Redemption
No shares of convertible preferred stock were unilaterally redeemable by either the stockholders or the Company. The Company’s Amended and Restated Certificate of Incorporation provided that upon a liquidation event, the holders of convertible preferred stock were entitled to receive the original issue price plus declared but unpaid dividends.
v3.22.0.1
COMMON STOCK
 12 Months Ended
Dec. 31, 2021
Equity [Abstract]  
COMMON STOCK COMMON STOCK
Effective October 1, 2018, the Company implemented a dual class voting structure pursuant to which it authorized the issuance of Class A common stock and Class B common stock. The Class B common stock had ten votes per share and the Class A common stock had one vote per share. The common stock outstanding prior to the implementation of the dual class voting structure was reclassified into Class B common stock. Generally, any subsequent sale or transfer of Class B common stock resulted in the automatic conversion of such Class B common stock into Class A common stock (subject to certain customary exceptions). Generally, any subsequent sale or transfer of convertible preferred stock that was convertible into Class B common stock resulted in that convertible preferred stock becoming convertible into Class A common stock (subject to certain customary exceptions). The holders of shares of Class A common stock and Class B common stock, voting as a separate class, had a right to elect two members of the Board. Furthermore, holders of Class A common stock and Class B common stock, voting together with holders of convertible preferred stock (other than Series E convertible preferred stock) and Series FF preferred stock on an as-converted to common stock basis, were entitled to fill any remaining vacancies on the Board.
On April 1, 2021, in anticipation of the Direct Listing and upon a vote by the requisite holders of the Company’s convertible preferred stock, all outstanding shares of convertible preferred stock were converted into 8,556,952 shares of Class A common stock and 103,850,006 shares of Class B common stock.
Effective April 1, 2021, in connection with the Direct Listing, the Company filed the Restated Certificate of Incorporation, amending and restating its certificate of incorporation to authorize 10,000,000,000 shares of Class A common stock, 500,000,000 shares of Class B common stock, 500,000,000 shares of undesignated common stock, and 500,000,000 shares of undesignated preferred stock. Shares of Class A common stock and Class B common stock will be treated equally, identically and ratably, on a per share basis, with respect to dividends that may be declared by the Board. Holders of Class A common stock are entitled to one vote per share, and holders of Class B common stock are entitled to 20 votes per share. Holders of Class A common stock and Class B common stock generally vote together as a single class on all matters (including the election of directors) submitted to a vote of the stockholders of the Company. Upon a liquidation, dissolution or winding-up of the Company, the assets legally available for distribution to stockholders would be distributed ratably among the holders of Class A common stock and Class B common stock and any participating preferred stock or new series of common stock outstanding at that time, subject to prior satisfaction of all outstanding debt and liabilities and the preferential rights of and the payment of liquidation preferences, if any, on any outstanding shares of preferred stock or new series of common stock. Shares of Class B common stock are convertible at any time at the option of the holder into shares of Class A common stock on a one-to-one basis. In addition, each share of Class B common stock will automatically convert into a share of Class A common stock upon a sale or transfer (other than with respect to certain estate planning and other transfers). Further, upon certain events specified in the Restated Certificate of Incorporation, all outstanding shares of Class B common stock will convert automatically into shares of Class A common stock.
In June 2014, the Company issued a warrant to a financial institution in connection with a banking agreement to purchase 407,928 shares of Class B common stock at an exercise price of $1.0068 per share. The warrant was immediately exercisable and had a term expiring on June 24, 2024. The warrant was fully expensed at December 31, 2015 and was exercised during the year ended December 31, 2021.
The Company has reserved shares of Class A common stock and Class B common stock for issuance for the following purposes (in thousands):
December 31,
20212020
Class A common stock
Conversion of Series E convertible preferred stock— 8,832 
Options issued and outstanding under the 2013 Plan1,569 3,550 
Options issued and outstanding under the 2019 Plan29,311 37,232 
RSUs issued and outstanding under the 2019 Plan5,851 3,766 
Shares available for future issuance under the 2019 Plan— 2,193 
RSUs issued and outstanding under the 2021 Plan1,402 — 
Shares available for future issuance under the 2021 Plan35,856 — 
Shares available for future issuance under the 2021 Employee Stock Purchase Plan5,125 — 
Replacement options issued and outstanding from the Tagomi acquisition4 32 
Replacement options issued and outstanding from the Bison Trails acquisition223 — 
RSUs issued and outstanding from other acquisitions229 — 
Exercise and conversion of an outstanding warrant— 4 
Shares available for future issuance of warrants2,296 2,296 
Total Class A common stock shares reserved81,866 57,905 
Class B common stock
Conversion of FF Preferred and Series A, B, C, and D convertible preferred stock— 104,046 
Options issued and outstanding under the 2013 Plan6,101 22,442 
Exercise and conversion of an outstanding warrant— 408 
Total Class B common stock shares reserved6,101 126,896 
v3.22.0.1
STOCK-BASED COMPENSATION
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION
Stock plans
The Company maintains four equity incentive plans: the 2013 Amended and Restated Stock Plan (the “2013 Plan”), the 2019 Equity Incentive Plan (the “2019 Plan”), the 2021 Equity Incentive Plan (the “2021 Plan,” and together with the 2013 Plan and the 2019 Plan, the “Plans”), and the 2021 Employee Stock Purchase Plan (the “ESPP”). Following the Direct Listing, the Company has only issued awards under the 2021 Plan and the ESPP, and no additional awards will be granted under the 2013 Plan and 2019 Plan. In addition, certain of the Company’s existing options assumed in connection with acquisitions are governed by the terms of the acquired company’s equity awards plan.
In February 2021, the Board approved and adopted the 2021 Plan. The 2021 Plan became effective on March 31, 2021, the date immediately prior to the effective date of the Company’s registration statement for the Direct Listing. The 2021 Plan serves as the successor to the 2019 Plan. Outstanding awards under the 2019 Plan continue to be subject to the terms and conditions of the 2019 Plan. The 2021 Plan provides for the granting of incentive stock options, restricted stock units (“RSUs”), restricted stock, stock appreciation rights and performance and stock bonus awards to assist in attracting, retaining and motivating employees. The number of shares available for grant and issuance under the 2021 Plan will be automatically increased on January 1st of each of the first ten fiscal years during the term of the 2021 Plan by the lesser of (a) five percent of the total number of shares of all classes of the Company’s common stock issued and outstanding on an as converted to common stock basis on each December 31st immediately prior to the date of increase or (b) such number of shares determined by the Board.
As of December 31, 2021, only stock options and RSUs were issued and outstanding under the Plans.
Stock options
Options granted under the Plans may be either incentive stock options (“ISOs”) or nonqualified stock options (“NSOs”). ISOs may be granted only to Company employees (including officers and directors who are also employees). NSOs may be granted to Company employees and non-employees.
Options under the Plans may be granted for contractual periods of up to ten years and at prices determined by the Board, provided, however, that the exercise price of an ISO and NSO shall not be less than 100% of the estimated fair value of the underlying shares on the date of the grant (110% if granted to a stockholder who owns more than ten percent of the total combined voting power of all classes of stock of the Company or any parent or subsidiary).
To date, options granted to new employees of the Company generally vest over four years and vest at a rate of 25% upon the first anniversary of the issuance date and 1/48 per month thereafter. Refresher options granted to existing employees of the Company generally vest over four years and vest at a rate of 1/48 per month. The 2019 Plan allows for a seven-year exercise window post-termination for employees of the Company who have provided at least two years of continuous service to the Company as of their termination date.
Activity of options outstanding are as follows (in thousands, except per share and years data):
Options OutstandingWeighted Average Exercise Price per ShareWeighted Average Remaining Contractual Life (Years)Aggregate Intrinsic Value
Balance at January 1, 202163,256 $14.84 8.17$2,527,396 
Assumed options from acquisition470 3.45 
Exercised(24,920)8.72 
Forfeited and cancelled(1,598)19.67 
Balance at December 31, 202137,208 $18.60 7.83$8,698,078 
Vested and exercisable at December 31, 202115,777 $14.90 7.14$3,746,507 
Vested and expected to vest at December 31, 202131,074 $17.64 7.67$7,293,948 
During the year ended December 31, 2021, the Company assumed stock options for the purchase of 470,128 shares of the Company’s Class A common stock, with a weighted-average grant date fair value of $110.97 per share in connection with a certain acquisition. During the year ended December 31, 2021, the Company did not issue any other stock options. During the year ended December 31, 2020, the Company granted stock options for the purchase of 32,200,586 shares of the Company’s Class A common stock, with a weighted-average grant date fair value of $7.85 per share.
During the years ended December 31, 2021, 2020 and 2019, $3.5 million, $3.0 million and $2.6 million of stock-based compensation expense was included in capitalized software, respectively.
As of December 31, 2021, there was total unrecognized compensation cost of $180.9 million related to unvested stock options. These costs are expected to be recognized over a weighted-average period of approximately 2.8 years.
The intrinsic value is calculated as the difference between the exercise price of the underlying stock option award and the estimated fair value of the Company’s common stock. The aggregate intrinsic value of stock options exercised during the years ended December 31, 2021 and December 31, 2020 was $5.9 billion and $38.3 million, respectively.
During the year ended December 31, 2021, 14,966,504 stock options vested with a weighted-average grant date fair value of $8.74 per share. During the year ended December 31, 2020, 7,936,075 stock options vested with a weighted-average grant date fair value of $5.47 per share.
The assumptions used under the Black-Scholes-Merton option pricing model and the weighted average calculated value of the options granted to employees were as follows:
Year Ended December 31,
20212020
Dividend yield0.0 %0.0 %
Expected volatility44.0 %41.1 %
Expected term (in years)4.86.0
Risk-free interest rate0.5 %0.6 %
Early exercise of stock options
Stock options granted under the Plans provide employee option holders the right to exercise unvested options for restricted common stock, which is subject to a repurchase right held by the Company at the original purchase price in the event the optionee’s employment is terminated either voluntarily or involuntarily prior to vesting of the exercised stock. Early exercises of options are not deemed to be substantive exercises for accounting purposes and accordingly, amounts received for early exercises are recorded as a liability. These repurchase terms are considered to be a forfeiture provision and do not result in variable accounting. As of December 31, 2021 and December 31, 2020, there were 478,271 and 263,761 shares, respectively, subject to repurchase related to stock options early exercised and not yet vested, but that are expected to vest. These amounts are reclassified to common stock and additional paid in capital as the underlying shares vest. As of December 31, 2021 and December 31, 2020, the Company recorded a liability related to these shares subject to repurchase in the amount of $8.9 million and $4.6 million, respectively, which is included within Accrued expenses and other current liabilities in the accompanying consolidated balance sheets.
Chief Executive Officer performance award
On August 11, 2020, the Company granted its Chief Executive Officer an option award to purchase up to 9,293,911 shares of the Company’s Class A common stock, at an exercise price of $23.46 per share. Vesting of the award is dependent on both performance-based and market-based conditions being met.
The performance condition was contingent on the Company’s registration statement being declared effective by the Securities and Exchange Commission (the “SEC”) under the Securities Act. The occurrence of this event was considered to not be probable until such time that it occurred. The market condition is contingent on the Company’s Class A common stock price achieving stock price target milestones.
The total grant date fair value of this award was $56.7 million. The Company determined the fair value of the option using a Monte Carlo simulation model (a binomial lattice-based valuation model). The Monte Carlo simulation model uses multiple input variables to determine the probability of satisfying the market condition requirements. The fair value of the option is not subject to change based on future market conditions. Once the performance condition becomes probable of being achieved, the fair value of the option is recognized as compensation expense over the requisite service period, using the accelerated attribution method regardless of whether, and the extent to which, the market condition is ultimately satisfied.
During April 2021, as a result of the Company’s registration statement being declared effective by the SEC, the performance condition of the option award granted to the Chief Executive Officer was met. On July 8, 2021, the first price target of the award was met, resulting in the vesting of 3,159,930 shares subject to the option award. During the years ended December 31, 2021 and 2020, compensation expense of $29.5 million and $0 was recognized related to this award, respectively.
Restricted stock units
The Company’s RSUs vest upon the satisfaction of a service-based condition. In general, the RSUs vest over a service period ranging from one to four years. Once vested, the RSUs are settled by delivery of shares of the Company’s Class A common stock.
Activity of RSUs outstanding under the Plans are as follows (in thousands, except per share data):
Number of sharesWeighted-Average Grant Date Fair Value Per Share
Balance at January 1, 20213,766 $54.80 
Granted6,433 233.24
Vested(2,421)194.60 
Forfeited and cancelled(296)200.85 
Balance at December 31, 20217,482 157.22 
For RSUs granted prior to the Direct Listing, the fair value of the Class A common stock was determined using linear interpolation between the dates at which the Company obtained third-party valuations, for financial reporting purposes. This method was determined to be reasonable, as no single event was identified that caused the increase in the fair value of the common stock. For RSUs granted after the Direct Listing, the closing price of the Company’s Class A common stock as reported on The Nasdaq Global Select Market on the grant date was used as the fair value.
As of December 31, 2021, there was total unrecognized compensation cost of $1.0 billion related to unvested RSUs. These costs are expected to be recognized over a weighted-average period of approximately 2.52 years.
Included in the total RSUs granted during 2020 was 181,000 RSUs granted to Kathryn Haun, a member of the Board and a general partner at Andreessen Horowitz, a related party. These RSUs were granted during December 2020 and will became fully vested on January 1, 2021. There are no other vesting conditions nor are there any conditions that would result in forfeiture of the award. The Company recognized $9.9 million of stock-based compensation expense related to this award during the year ended December 31, 2020.
Restricted common stock
As part of the Company’s acquisitions, the Company issued restricted Class A common stock. Vesting of this restricted Class A common stock is dependent on a service-based vesting condition that is satisfied over three years. The Company has the right to repurchase shares at par value for which the vesting condition is not satisfied. Activity of shares of restricted Class A common stock is as follows (in thousands, except per share data):
Number of sharesWeighted-Average Grant Date Fair Value Per Share
Balance at January 1, 2021824 $23.46 
Granted1,465 180.33
Vested(275)23.46 
Forfeited and cancelled— — 
Balance at December 31, 20212,014 137.57 
As of December 31, 2021, there was total unrecognized compensation cost of $207.6 million related to unvested restricted Class A common stock. These costs are expected to be recognized over a weighted-average period of approximately 2.15 years.
Employee Stock Purchase Plan
In February 2021, the Board approved and adopted the ESPP. The ESPP became effective on April 1, 2021, the effective date of the Company’s registration statement for the Direct Listing. The ESPP allows eligible employees the option to purchase shares of the Company's Class A common stock at a 15% discount, over a series of offering periods through accumulated payroll deductions over the period. The ESPP also includes a look-back provision for the purchase price if the stock price on the purchase date is lower than the stock price on the offering date. The Company recognizes stock-based compensation expenses related to purchase rights granted pursuant to its ESPP on a straight-line basis over the offering period, which is 24 months. The fair value of purchase rights granted under the ESPP is estimated on the date of grant using the Black-Scholes-Merton option valuation model.
The number of shares available for grant and issuance under the ESPP will be automatically increased on January 1st of each of the first ten fiscal years during the term of the ESPP by the lesser of (a) one percent of the total number of shares of all classes of the Company’s common stock outstanding on an as converted to common stock basis on each December 31st immediately prior to the date of increase or (b) such number of shares determined by the Board or the compensation committee of the Board.
The grant date of the initial offering period was May 3, 2021, and that offering period will end on April 30, 2023. For the year ended December 31, 2021, total compensation expense of $9.4 million was recognized related to the ESPP. As of December 31, 2021, the Company recorded a liability of $7.4 million related to the accumulated payroll deductions, which are refundable to employees who withdraw from the ESPP. This amount is included within Accrued expenses and other current liabilities in the accompanying consolidated balance sheets.
Stock-based compensation expense
Stock-based compensation was included in the following components of expenses on the accompanying consolidated statements of operations (in thousands):
Year Ended December 31,
202120202019
Technology and development$571,861 $36,869 $25,220 
Sales and marketing32,944 1,566 970 
General and administrative215,880 34,190 24,699 
Restructuring— — 994 
Total$820,685 $72,625 $51,883 
v3.22.0.1
INCOME TAXES
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
The components of income (loss) before income taxes were attributable to the following regions (in thousands):
Year Ended December 31,
202120202019
Domestic$2,977,406$396,709$(55,383)
Foreign49,54112,4909,967
$3,026,947$409,199$(45,416)
(Benefit from) provision for income taxes consisted of the following (in thousands):
Year Ended December 31,
202120202019
Current
Federal$(51,942)$65,269$2,053
State4,45618,162(639)
Foreign8,6422,9774,277
Total current(38,844)86,4085,691
Deferred
Federal(438,810)1,373(15,519)
State(93,959)(514)(5,496)
Foreign(25,560)(385)295
Total deferred(558,329)474(20,720)
Total (benefit from) provision for income taxes$(597,173)$86,882$(15,029)
The effective income tax rate differs from the statutory federal income tax rate as follows:
Year Ended December 31,
202120202019
Provision for income taxes at U.S. statutory rate21.00 %21.00 %21.00 %
State income taxes, net of federal benefit(4.67)3.39 10.58 
Foreign rate differential(1.09)(0.24)(3.52)
Non-deductible compensation0.83 0.99 (2.20)
Equity compensation(31.95)0.27 2.31 
Prior year true-ups (state and federal)0.14 (0.11)1.51 
Research and development credits(9.60)(1.86)15.63 
Change in valuation allowance1.65 — — 
Foreign tax credit— (0.05)2.75 
Subpart F income— 0.09 (1.95)
Foreign Derived Intangible Income (“FDII”)— (1.50)— 
Global Intangible Low Taxed Income (“GILTI”)— 0.06 (1.15)
Uncertain tax positions3.07 0.46 (8.26)
CARES Act - NOL Carryback— (1.20)— 
Other0.89 (0.07)(3.61)
(19.73)%21.23 %33.09 %
The Company’s effective tax rate for 2021 was significantly lower compared to 2020. This was due primarily to an increase in 2021 tax benefits from deductible stock option exercises as a result of the Company’s Direct Listing, and an increase in 2021 federal and California research and development credits. The Company’s effective tax rate decrease from 2019 to 2020 was due to the higher percentage impact of 2019 permanent items on a significantly lower pretax amount.
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
Significant components of the Company’s deferred tax assets and liabilities consisted of the following (in thousands):
Year Ended December 31,
20212020
Deferred tax assets
Accruals and reserves$19,184$1,943
Net operating loss carryforward262,5746,322
Lease liability26,33829,845
Interest carryforward—1,047
Tax credits285,0294,584
Stock-based compensation50,29218,726
Intangibles7,3394,563
Book crypto asset impairments and realized losses37,9321,275
Other—1,045
Gross deferred tax assets688,68869,350
Less valuation allowance(54,383)(5,174)
Total deferred tax assets634,30564,176
Deferred tax liabilities
State taxes(973)(798)
Fixed assets and internally developed software(15,937)(11,391)
Prepaid expenses(3,439)(3,179)
Right of use asset(24,347)(28,001)
Installment gain(15,859)—
Other(203)—
Total deferred tax liabilities(60,758)(43,369)
Total net deferred tax assets$573,547$20,807
A valuation allowance of $54.4 million and $5.2 million was recorded against the Company’s net deferred tax asset balance as of December 31, 2021 and December 31, 2020, respectively. As of each reporting date, management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. On the basis of this evaluation, only the portion of the deferred tax asset that is more likely than not to be realized was recognized. The valuation allowance as of December 31, 2021 includes allowances primarily related to California research and development credits, U.S. federal, state and foreign net operating loss carryforwards from acquired entities, and net operating loss carryforwards in Japan.
As of December 31, 2021 and December 31, 2020, the Company had California research and development credits of $108.3 million and $4.6 million respectively, of which the Company has a net valuation allowance of $45.4 million as of December 31, 2021. The Company had $873.6 million and $24.5 million of U.S. federal net operating loss carryforwards as of December 31, 2021 and December 31, 2020, respectively. The U.S. federal net operating losses carry forward indefinitely. Additionally, the Company has U.S. state net operating losses of $1.1 billion. Generally, California and other significant U.S. states have a twenty-year carryforward for net operating losses.
Activity related to the Company’s unrecognized tax benefits consisted of the following (in thousands):
Year Ended December 31,
202120202019
Balance, beginning of year$12,807 $10,344 $6,605 
Increase related to tax positions taken during a prior year— 212 13 
Decreases related to tax positions taken during a prior year— (882)(77)
Increases related to tax positions taken during the current year98,212 3,133 3,803 
Balance, end of year$111,019 $12,807 $10,344 
As of December 31, 2021 and December 31, 2020, the Company had $111.0 million and $12.8 million of unrecognized tax benefits, of which $84.9 million and $12.3 million would reduce income tax expense and the effective tax rate, if recognized. It is reasonably possible that the balance of unrecognized tax benefits could decrease within the next twelve months as a result of U.S. Internal Revenue Service (“IRS”) audit closures. The potential reduction in unrecognized tax benefits is $7.5 million, of which $4.5 million would favorably impact the Company’s effective tax rate. The Company accounts for interest and penalties related to exposures as a component of income tax expense. The Company had approximately $0.6 million and $0.6 million and $0.4 million and $0.4 million of accrued interest and penalties for the years ended December 31, 2021 and December 31, 2020, respectively.
The Company files U.S. federal, state, and foreign income tax returns in jurisdictions with varying statutes of limitations. Currently these statutes of limitations are open from 2017 forward for the U.S., 2016 forward for California, 2017 forward for the United Kingdom, and 2018 forward for Ireland. The Company’s tax returns are under audit by the IRS for 2017 through 2019, and the state of California for 2016 and 2017.
v3.22.0.1
NET INCOME (LOSS) PER SHARE
 12 Months Ended
Dec. 31, 2021
Earnings Per Share [Abstract]  
NET INCOME (LOSS) PER SHARE NET INCOME (LOSS) PER SHARE
The computation of net income (loss) per share is as follows (in thousands, except per share amounts):
Year Ended December 31,
202120202019
Basic net income (loss) per share:
Numerator
Net income (loss)$3,624,120 $322,317 $(30,387)
Less: Income allocated to participating securities(527,162)(214,061)— 
Net income (loss) attributable to common stockholders, basic$3,096,958 $108,256 $(30,387)
Denominator
Weighted-average shares of common stock used to compute net income per share attributable to common stockholders, basic177,319 68,671 61,317 
Net income (loss) per share attributable to common stockholders, basic$17.47 $1.58 $(0.50)
Diluted net income (loss) per share:
Numerator
Net income (loss)$3,624,120 $322,317 $(30,387)
Less: Income allocated to participating securities(439,229)(194,846)— 
Add: Interest on convertible notes6,208 — — 
Less: Fair value gain on contingent consideration arrangement (695)— — 
Net income (loss) attributable to common stockholders - diluted$3,190,404 $127,471 $(30,387)
Denominator
Weighted-average shares of common stock used to compute net income per share attributable to common stockholders, basic177,319 68,671 61,317 
Weighted-average effect of potentially dilutive securities:
Stock options36,396 22,146 — 
RSUs3,773 — — 
Restricted common stock9 — — 
Warrants72 392 — 
Convertible notes2,388 — — 
Contingent consideration8 — — 
Weighted-average shares of common stock used to compute net income (loss) per share attributable to common stockholders, diluted219,965 91,209 61,317 
Net income (loss) per share attributable to common stockholders, diluted$14.50 $1.40 $(0.50)
The Company’s convertible preferred stock and restricted Class A common stock granted as consideration in the acquisitions of Tagomi and Bison Trails are participating securities. These participating securities do not contractually require the holders of such shares to participate in the Company’s losses, if applicable.
The rights, including the liquidation and dividend rights, of the holders of Class A common stock and Class B common stock are identical, except with respect to voting. As a result, the undistributed earnings are allocated on a proportionate basis and the resulting income (loss) per share will, therefore, be the same for both Class A common stock and Class B common stock on an individual or combined basis.
The following potentially dilutive shares were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive (in thousands):
Year Ended December 31,
202120202019
Employee stock options6,134 12,831 37,758 
RSUs151 3,766 — 
Warrants— — 408 
Restricted common stock5 — — 
Employee stock purchase plan295 — — 
Contingent consideration recognized in asset acquisition— — 691 
Convertible preferred stock— — 114,959 
Total6,585 16,597 153,816 
v3.22.0.1
COMMITMENTS AND CONTINGENCIES
 12 Months Ended
Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES
Crypto asset wallets
The Company has committed to securely store all crypto assets it holds on behalf of users. As such, the Company may be liable to its users for losses arising from theft or loss of user private keys. The Company has no reason to believe it will incur any expense associated with such potential liability because (i) it has no known or historical experience of claims to use as a basis of measurement, (ii) it accounts for and continually verifies the amount of crypto assets within its control, and (iii) it has established security around custodial private keys to minimize the risk of theft or loss. Since the risk of loss is remote, the Company had not recorded a liability at December 31, 2021 or December 31, 2020.
Indemnifications
In the event any registrable securities are included in a registration statement, the Company’s Amended and Restated Investors’ Rights Agreement (the “IRA”) entered into with certain of the Company’s stockholders provides indemnity to each stockholder, their partners, members, officers, directors, and stockholders, legal counsel, and accountants; each underwriter, if any; and each person who controls each stockholder or underwriter, against any damages incurred in connection with investigating or defending any claim or proceeding arising as a result of such registration from which damages may result. The Company will reimburse each such party for any legal and any other expenses reasonably incurred, provided that the Company will not be liable in any such case to the extent the damages arise out of or are based upon any actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of such stockholder or underwriter and stated to be specifically for use therein.
The Company also has indemnity agreements with certain officers and directors of the Company pursuant to which the Company must indemnify the officer or director against all expenses, judgments, fines, and amounts paid in settlement reasonably incurred in connection with a third party proceeding, if the indemnitee acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the Company, and in the case of a criminal proceeding, had no reasonable cause to believe the indemnitee’s conduct was unlawful.
It is not possible to determine the maximum potential exposure under these indemnification agreements: (i) because the facts and circumstances involved in each claim are unique and we cannot predict the number or nature of claims that may be made; (ii) due to the unique facts and circumstances involved in each particular agreement; and (iii) due to the requirement for a registration of the Company’s securities before any of the indemnification obligations contemplated in the IRA become effective.
The Company has also provided indemnities or similar commitments on standard commercial terms in the ordinary course of business.
Legal and regulatory proceedings
The Company is subject to various litigation, regulatory investigations, and other legal proceedings that arise in the ordinary course of its business. The Company is also subject to regulatory oversight by numerous regulatory and other governmental agencies. The Company reviews its lawsuits, regulatory investigations, and other legal proceedings on an ongoing basis and provides disclosure and records loss contingencies in accordance with the loss contingencies accounting guidance. In accordance with such guidance, the Company establishes accruals for such matters when potential losses become probable and can be reasonably estimated. If the Company determines that a loss is reasonably possible and the loss or range of loss can be estimated, the Company discloses the possible loss in the consolidated financial statements.
In July and August 2021, three purported securities class actions were filed in the U.S. District Court for the Northern District of California against the Company, its directors, certain of its officers and employees, and certain venture capital and investment firms. The complaints alleged violations of Sections 11, 12(a)(2) and 15 of the Securities Act, in connection with the registration statement and prospectus filed in connection with the Direct Listing. In November 2021, these actions were consolidated and recaptioned as In re Coinbase Global Securities Litigation, and an amended complaint was filed. The Company disputes the claims in this matter and is vigorously defending against them. The plaintiff seeks, among other relief, unspecified compensatory damages, attorneys’ fees, and costs. Based on the preliminary nature of the proceedings in this matter, the outcome of this matter remains uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time.
In October 2021, a purported class action captioned Underwood et al. v. Coinbase Global, Inc., was filed in the U.S. District Court for the Southern District of New York against the Company. The plaintiffs allege claims under Sections 5, 15(a)(1) and 29(b) of the Exchange Act and violations of certain California and Florida state statutes. Among other relief requested, the plaintiffs seek injunctive relief, unspecified damages, attorneys’ fees and costs. The Company disputes the claims in this case and intends to vigorously defend against them. Based on the preliminary nature of the proceedings in this case, the outcome of this matter remains uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time.
In December 2021, a shareholder derivative suit captioned Shin v. Coinbase Global, Inc., was filed in New York state court against the Company and its directors, alleging breach of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets, and seeking unspecified damages and injunctive relief. The Company disputes the claims in this case and intends to vigorously defend against them. Based on the preliminary nature of the proceedings in this case, the outcome of this matter remains uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time.
The Company’s subsidiary, Coinbase, Inc., which holds a Bitlicense from the New York Department of Financial Services (“NYDFS”) and is therefore subject to examinations and investigations by the NYDFS, is currently subject to an investigation by the NYDFS relating to its compliance program including compliance with the Bank Secrecy Act and sanctions laws, cybersecurity, and customer support. Coinbase, Inc. is cooperating fully and has undertaken initial remedial measures, and may face additional remedial and other measures. Based on the ongoing nature of the investigation, the outcome of this matter remains uncertain and the Company cannot estimate the potential impact, if any, on its business or financial statements at this time.
The Company believes the ultimate resolution of existing legal and regulatory investigation matters will not have a material adverse effect on the financial condition, results of operations, or cash flows of the Company. However, in light of the uncertainties inherent in these matters, it is possible that the ultimate resolution of one or more of these matters may have a material adverse effect on the Company’s results of operations for a particular period, and future changes in circumstances or additional information could result in additional accruals or resolution in excess of established accruals, which could adversely affect the Company’s results of operations, potentially materially.
Tax regulation
Current promulgated tax rules related to crypto assets are unclear and require significant judgments to be made in interpretation of the law, including but not limited to the areas of income tax, information reporting, transaction level taxes and the withholding of tax at source. Additional legislation or guidance may be issued by U.S. and non-U.S. governing bodies that may differ significantly from the Company's practices or interpretation of the law, which could have unforeseen effects on the Company’s financial condition and results of operations, and accordingly, the related impact on the Company’s financial condition and results of operations is not estimable.
v3.22.0.1
SUBSEQUENT EVENTS
 12 Months Ended
Dec. 31, 2021
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS SUBSEQUENT EVENTS
Unbound Security, Inc. acquisition
On January 4, 2022, the Company acquired all outstanding shares of capital stock and stock options of Unbound Security, Inc. (“Unbound”). Unbound is a pioneer in a number of cryptographic security technologies, which the Company believes will play a foundational role in the Company’s product and security roadmap.
The total estimated consideration transferred in the acquisition consisted of the following (in thousands):
Cash$151,550 
Class A common stock of the Company103,977
RSUs for Shares of the Company’s Class A common stock2,457
Total estimated purchase consideration$257,984 
The initial accounting for the acquisition was incomplete at the time these financial statements were issued. The fair value of the acquired assets and liabilities were still being determined. As such, the disclosure of these amounts could not be made.
FairXchange, Inc. acquisition
On January 11, 2022, the Company entered into an agreement to acquire all outstanding shares of capital stock, stock options and warrants of FairXchange, Inc. (“FairX”). FairX is a CFTC-regulated derivatives exchange and the Company believes it will be a key stepping stone on the Company’s path to offer crypto derivatives to retail and institutional customers in the United States. The acquisition was completed on February 1, 2022. The initial accounting for the acquisition was incomplete at the time the financial statements were issued. The fair value of the total consideration transferred, as well as the acquired assets and liabilities were still being determined. As such, the disclosure of these amounts could not be made.
v3.22.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)
 12 Months Ended
Dec. 31, 2021
Accounting Policies [Abstract]  
Basis of presentation and principles of consolidation
Basis of presentation and principles of consolidation
The accompanying consolidated financial statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”), and include the accounts of the Company and its subsidiaries. The Company’s subsidiaries are entities in which the Company holds, directly or indirectly, more than 50% of the voting rights or where it exercises control. Certain subsidiaries of the Company have a basis of presentation different from GAAP. For the purposes of the consolidated financial statements, the basis of presentation of such subsidiaries is converted to GAAP. All intercompany accounts and transactions have been eliminated in consolidation.
Reclassifications
Reclassifications
Certain prior period amounts have been reclassified in order to conform with the current period presentation. These reclassifications have no impact on the Company’s previously reported consolidated net income.
Use of estimates
Use of estimates
The preparation of the consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions in the Company’s consolidated financial statements and notes thereto.
Significant estimates and assumptions include the determination of the recognition, measurement, and valuation of current and deferred income taxes; the fair value of stock-based awards issued; the useful lives of intangible assets; the impairment of long-lived assets; the Company’s incremental borrowing rate; the fair value of assets acquired and liabilities assumed in business combinations, including contingent consideration arrangements; the fair value of derivatives and related hedges; the fair value of long-term debt; assessing the likelihood of adverse outcomes from claims and disputes; and loss provisions.
Actual results and outcomes may differ from management’s estimates and assumptions due to risks and uncertainties. To the extent that there are material differences between these estimates and actual results, the Company’s consolidated financial statements will be affected. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the result of which forms the basis for making judgments about the carrying values of assets and liabilities.
Foreign currency transactions
Foreign currency transactions
The Company’s functional currency is the U.S. dollar. The Company has exposure to foreign currency translation gains and losses arising from the Company’s net investment in foreign subsidiaries. The revenues, expenses, and financial results of these foreign subsidiaries are recorded in their respective functional currencies. The financial statements of these subsidiaries are translated into U.S. dollars using a current rate of exchange, with gains or losses, net of tax as applicable, included in Accumulated other comprehensive (loss) income (“AOCI”) within the consolidated statements of changes in convertible preferred stock and stockholders’ equity. Cumulative translation adjustments are released from AOCI and recorded in the statements of operations when the Company disposes or loses control of a consolidated subsidiary. Gains and losses resulting from remeasurement are recorded in Other income (loss), net within the consolidated statements of operations.
Business combinations
Business combinations
The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of the acquisition. Purchase accounting results in assets and liabilities of an acquired business being recorded at their estimated fair values on the acquisition date. Any excess consideration over the fair value of assets acquired and liabilities assumed is recognized as goodwill. Acquisition-related costs incurred by the Company are recognized as an expense in General and administrative expenses within the consolidated statements of operations.
The Company uses its best estimates and assumptions to assign fair value to the tangible and intangible assets acquired and liabilities assumed at the acquisition date. The Company’s estimates are inherently uncertain and subject to refinement.
During the measurement period, which may be up to one year from the acquisition date, and to the extent that the value was not previously finalized, the Company may record adjustments to the fair value of these tangible and intangible assets acquired and liabilities assumed, with the corresponding offset to goodwill. In addition, uncertain tax positions and tax-related valuation allowances are initially recorded in connection with a business combination as of the acquisition date. The Company continues to collect information about facts and circumstance that existed at the date of acquisition and reevaluates these estimates and assumptions quarterly and records any adjustments to the Company’s preliminary estimates to goodwill, provided that the Company is within the measurement period. Upon the conclusion of the measurement period or final determination of the fair value of assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to the Company’s consolidated statements of operations.
Fair value measurements
Fair value measurements
The Company measures certain assets and liabilities at fair value. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
•Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
•Level 2: Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
•Level 3: Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents include cash and interest-bearing highly liquid investments held at financial institutions, cash on hand that is not restricted as to withdrawal or use with an initial maturity of three months or less, and cash held in accounts at crypto trading venues. Crypto asset and fiat wallet service trading venues include other crypto asset trading platforms that hold money transmitter licenses, and where the Company holds funds in its accounts with those trading platforms. Cash and cash equivalents excludes customer legal tender, which is reported separately as Customer custodial funds in the accompanying consolidated balance sheets. Refer to Customer custodial funds and custodial funds due to customers below for further details.
Restricted cash
Restricted cash
The Company has restricted cash deposits at financial institutions related to operational restricted deposits and a standby letter of credit.
Customer custodial funds and custodial funds due to customers
Customer custodial funds and custodial funds due to customers
Customer custodial funds represent restricted cash and cash equivalents maintained in segregated Company bank accounts that are held for the exclusive benefit of customers. Custodial funds due to customers represent cash deposits held by customers in their fiat wallets and unsettled deposits and withdrawals. The Company restricts the use of the assets underlying the customer custodial funds to meet regulatory requirements and classifies the assets as current based on their purpose and availability to fulfill its direct obligation under custodial funds due to customers.
Certain jurisdictions where the Company operates require the Company to hold eligible liquid assets, as defined by applicable regulatory requirements and commercial law in these jurisdictions, equal to at least 100% of the aggregate amount of all custodial funds due to customers. Depending on the jurisdiction, eligible liquid assets can include cash and cash equivalents, customer custodial funds, and in-transit funds receivable. As of December 31, 2021 and December 31, 2020, the Company’s eligible liquid assets were greater than the aggregate amount of custodial funds due to customers.
USDC USDCUSD Coin (“USDC”) is accounted for as a financial instrument; one USDC can be redeemed for one U.S. dollar on demand from the issuer.
Accounts and loans receivable and allowance for doubtful accounts
Accounts and loans receivable and allowance for doubtful accounts
Accounts and loans receivable are contractual rights to receive cash either on demand or on fixed or determinable dates, and are recognized as an asset on the Company’s balance sheet. Accounts and loans receivable consists of in-transit customer receivables, trade finance receivables, custodial fee revenue receivable, loans receivable, interest receivable, and other receivables.
In-transit customer receivables represent settlements from third-party payment processors and banks for customer transactions. In-transit receivables are typically received within one or two business days of the transaction date. The Company establishes withdrawal-based limits in order to mitigate potential losses by preventing customers from withdrawing the crypto asset to an external blockchain address until the payment settles. In certain jurisdictions, in-transit customer receivables qualify as eligible liquid assets to meet regulatory requirements to fulfill the Company’s direct obligations under custodial funds due to customers.
Trade finance receivables represent funds due for crypto assets delivered to credit eligible customers and are typically received within three business days from the transaction date. Trade finance receivables enable customers to instantly invest in crypto assets without pre-funding their trade.
Custodial fee revenue receivable represents the fee earned and receivable by the Company for providing a dedicated secure cold storage solution to customers. The fee is based on a contractual percentage of the daily value of assets under custody and is generally collected on a monthly basis. Such custodial fee revenue income is included in Net revenue in the consolidated statements of operations.
Loans receivable represent loans made to retail users and institutions. These loans are collateralized with crypto assets held by those users in their crypto asset wallet on the Company’s platform. Loans receivable are subsequently measured at amortized cost.
The Company recognizes an allowance for doubtful accounts for receivables based on expected credit losses. In determining expected credit losses, the Company considers historical loss experience, the aging of its receivable balance, and the fair value of any collateral held. For loans receivable, the Company applies the collateral maintenance provision practical expedient. The Company would recognize credit losses on these loans if there is a collateral shortfall and it is not reasonably expected that the borrower will replenish such a shortfall.
Concentration of credit risk
Concentration of credit risk
The Company’s cash, cash equivalents, restricted cash, customer custodial funds, and accounts and loans receivable are potentially subject to concentration of credit risk. Cash, cash equivalents, restricted cash, and customer custodial funds are placed with financial institutions which are of high credit quality. The Company invests cash, cash equivalents, and customer accounts primarily in highly liquid, highly rated instruments which are uninsured. The Company may also have deposit balances with financial institutions which exceed the Federal Deposit Insurance Corporation insurance limit of $250,000. The Company also holds cash at crypto trading venues and performs a regular assessment of these crypto trading venues as part of its risk management process.
Crypto assets held
Crypto assets held
The crypto assets held by the Company, with no qualifying fair value hedge, are accounted for as intangible assets with indefinite useful lives, and are initially measured at cost. Crypto assets accounted for as intangible assets are subject to impairment losses if the fair value of crypto assets decreases below the carrying value at any time during the period. The fair value is measured using the quoted price of the crypto asset at the time its fair value is being measured. Impairment expense is reflected in Other operating expense, net in the consolidated statements of operations. The Company assigns costs to transactions on a first-in, first-out basis.
Crypto assets held as the hedged item in qualifying fair value hedges are initially measured at cost. Subsequent changes in fair value attributable to the hedged risk are adjusted to the carrying amount of these crypto assets, with changes in fair value recorded in Other operating expense, net in the consolidated statements of operations.
The Company recognizes crypto assets received through airdrops or forks if the crypto asset is expected to generate probable future benefit and if the Company is able to support the trading, custody, or withdrawal of these assets. The Company records the crypto assets received through airdrops or forks at their cost.
Leases
Leases
The Company determines if an arrangement is a lease at inception. Operating leases are included in lease right-of-use (“ROU”) assets and lease liabilities in the consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of future minimum lease payments over the lease term. Most leases do not provide an implicit rate, so the Company uses its incremental borrowing rate. The operating lease ROU assets also include any lease payments made before commencement and exclude lease incentives.
The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that those options will be exercised. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company has made the policy election to account for short-term leases by recognizing the lease payments in profit or loss on a straight-line basis over the lease term and not recognizing these leases on the Company’s consolidated balance sheets. Variable lease payments are recognized in profit or loss in the period in which the obligation for those payments is incurred. The Company has real estate lease agreements with lease and non-lease components for which the Company has made the accounting policy election to account for these agreements as a single lease component.
Property and equipment
Property and equipment
Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the lesser of the estimated useful life of the asset or the remaining lease term. The estimated useful lives of the Company’s property, equipment, and software are generally as follows:
Property and equipmentUseful life
Furniture and fixtures
Three to five years
Computer equipment
Two to five years
Leasehold improvements
Lesser of useful life or remaining lease term
Capitalized software
One to three years
Construction-in-progress represents costs incurred on the construction of leasehold improvements that have not been completed or placed in service as of the end of the year, and accordingly, no depreciation expense has been recorded.
Capitalized software consists of costs incurred during the application development stage of internal-use software or implementation of a hosting arrangement that is a service contract. Capitalized costs consist of salaries and compensation costs for employees, fees paid to third-party consultants who are directly involved in development efforts, and costs incurred for upgrades and enhancements to add functionality of the software. Other costs that do not meet the capitalization criteria are expensed as incurred.
Long-lived assets, including ROU assets, goodwill, and acquired intangible assets
Long-lived assets, including ROU assets, goodwill, and acquired intangible assets
The Company evaluates the recoverability of long-lived assets on an annual basis, or more frequently whenever circumstances indicate a long-lived asset may be impaired. When indicators of impairment exist, the Company estimates future undiscounted cash flows attributable to such assets. In the event future undiscounted cash flows do not exceed the carrying amount of the assets, the asset would be considered impaired. The impairment loss is measured based upon the difference between the carrying amount and the fair value of the assets.
Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business combination. Goodwill is tested for impairment at the reporting unit level on an annual basis (October 1 for the Company) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. For the periods presented, the Company did not have any goodwill impairment charges.
Acquired intangible assets with a definite useful life are amortized over their estimated useful lives on a straight-line basis. Each period, the Company evaluates the estimated remaining useful life of its intangible assets and whether events or changes in circumstances warrant a revision to the remaining period of amortization. Intangible assets assessed as having indefinite lives are not amortized, but are assessed for indicators that the useful life is no longer indefinite or for indicators of impairment each period.
Investments
Investments
The Company holds the following categories of investments, which are included in other non-current assets in the consolidated balance sheets.
Equity method investments
The Company holds equity investments in privately held companies. The Company applies the equity method of accounting for investments in other entities when it holds between 20% and 50% of the common stock or in-substance common stock in the entity, or when it exercises significant influence over the entity. Under the equity method, the Company’s share of each entity’s profit or loss is reflected in Other expense (income), net in the consolidated statements of operations.
Strategic investments
The Company’s strategic investments primarily include investments in equity instruments where the Company (1) holds less than 20% ownership in the entity, and (2) does not exercise significant influence. These are recorded at cost and adjusted for observable transactions for same or similar investments of the same issuer (referred to as the measurement alternative) or impairment.
Crypto asset borrowings
Crypto asset borrowings
The Company borrows crypto assets from third parties on an unsecured basis. Such crypto assets borrowed by the Company are reported in crypto assets held on the Company’s consolidated balance sheets.
The borrowings are accounted for as hybrid instruments, with a liability host contract that contains an embedded derivative based on the changes in the fair value of the underlying crypto asset. The host contract is not accounted for as a debt instrument because it is not a financial liability, is carried at the fair value of the assets acquired and reported in crypto asset borrowings in the consolidated balance sheets. The embedded derivative is accounted for at fair value, with changes in fair value recognized in Other operating expense, net in the consolidated statements of operations. The embedded derivatives are included in crypto asset borrowings in the consolidated balance sheets.
The term of these borrowings can either be for a fixed term of less than one year or can be open-ended and repayable at the option of the Company or the lender. These borrowings bear a fee payable by the Company to the lender, which is based on a percentage of the amount borrowed and is denominated in the related crypto asset borrowed. The borrowing fee is recognized on an accrual basis and is included in Other operating expense, net in the consolidated statements of operations.
Derivative contracts
Derivative contracts
Derivative contracts derive their value from underlying asset prices, other inputs or a combination of these factors. Derivative contracts are recognized as either assets or liabilities in the consolidated balance sheets at fair value, with changes in fair value recognized in Other operating expense, net.
As a result of the Company entering into transactions to borrow crypto assets, an embedded derivative is recognized relating to the differences between the fair value of the amount borrowed, which is recognized on the borrowing effective date, and the fair value of the amount that will ultimately be repaid, based on changes in the spot price of the crypto asset over the term of the borrowing. This embedded derivative is accounted for as a forward contract to exchange at maturity the fixed amount of the crypto asset to be repaid.
Derivatives designated as hedges
The Company applies hedge accounting to certain derivatives executed for risk management purposes. To qualify for hedge accounting, a derivative must be highly effective at reducing the risk associated with the exposure being hedged. The Company uses fair value hedges primarily to hedge the fair value exposure of crypto asset prices. For qualifying fair value hedges, the changes in the fair value of the derivative and the fair value of the hedged item, the crypto assets, are recognized in current-period earnings in Other operating expense, net in the consolidated statements of operations. Derivative amounts affecting earnings are recognized in the same line item as the earnings effect of the hedged item.
Revenue recognition
Revenue recognition
The Company determines revenue recognition from contracts with customers through the following steps:
•identification of the contract, or contracts, with the customer;
•identification of the performance obligations in the contract;
•determination of the transaction price;
•allocation of the transaction price to the performance obligations in the contract; and
•recognition of the revenue when, or as, the Company satisfies a performance obligation.
Revenue is recognized when control of the promised goods or services is transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company primarily generates revenue through transaction fees charged on the platform.
Transaction revenue
Retail transaction revenue represents transaction fees earned from customers that are primarily individuals, while institutional transaction revenue represents transaction fees earned from institutional customers, such as hedge funds, family offices, principal trading firms, and financial institutions on the institutional platform.
The Company’s service is comprised of a single performance obligation to provide a crypto asset matching service when customers buy, sell, or convert crypto assets on the platform. That is, the Company is an agent in transactions between customers and presents revenue for the fees earned on a net basis.
Judgment is required in determining whether the Company is the principal or the agent in transactions between customers. The Company evaluates the presentation of revenue on a gross or net basis based on whether it controls the crypto asset provided before it is transferred to the customer (gross) or whether it acts as an agent by arranging for other customers on the platform to provide the crypto asset to the customer (net). The Company does not control the crypto asset being provided before it is transferred to the buyer, does not have inventory risk related to the crypto asset, and is not responsible for the fulfillment of the crypto asset. The Company also does not set the price for the crypto asset as the price is a market rate established by the platform. As a result, the Company acts as an agent in facilitating the ability for a customer to purchase crypto assets from another customer.
The Company considers its performance obligation satisfied, and recognizes revenue, at the point in time the transaction is processed. Contracts with customers are usually open-ended and can be terminated by either party without a termination penalty. Therefore, contracts are defined at the transaction level and do not extend beyond the service already provided.
The Company charges a fee at the transaction level. The transaction price, represented by the trading fee, is calculated based on volume and varies depending on payment type and the value of the transaction. Crypto asset purchase or sale transactions executed by a customer on the Company’s platform is based on tiered pricing that is driven primarily by transaction volume processed for a specific historical period. The Company has concluded that this volume-based pricing approach does not constitute a future material right since the discount is within a range typically offered to a class of customers with similar volume. The transaction fee is collected from the customer at the time the transaction is executed. In certain instances, the transaction fee can be collected in crypto assets, with revenue measured based on the amount of crypto assets received and the fair value of the crypto assets at the time of the transaction.
The transaction price includes estimates for reductions in revenue from transaction fee reversals that may not be recovered from customers. Such reversals occur when the customer disputes a transaction processed on their credit card or their bank account for a variety of reasons and seeks to have the charge reversed after the Company has processed the transaction. These amounts are estimated based upon the most likely amount of consideration to which the Company will be entitled. All estimates are based on historical experience and the Company’s best judgment at the time to the extent it is probable that a significant reversal of revenue recognized will not occur. All estimates of variable consideration are reassessed periodically. The total transaction price is allocated to the single performance obligation. While the Company recognizes transaction fee reversals as a reduction of net revenue, crypto asset losses related to those same transaction reversals are included in Transaction expense.
Blockchain rewards
The Company generates revenues in crypto assets through various blockchain protocols where the Company controls the staking validator address. These blockchain protocols, or the participants that form the protocol networks, reward users for performing various activities on the blockchain, such as participating in proof-of-stake networks and other consensus algorithms. The Company considers itself the principal in transactions with the blockchain networks, and therefore presents such blockchain rewards earned on a gross basis. Blockchain rewards are primarily comprised of Staking revenue in which the Company participates in networks with proof-of-stake consensus algorithms, through creating or validating blocks on the network using the staking validators that it controls. In exchange for participating in the consensus mechanism of these networks, the Company earns rewards in the form of the native token of the network. Each block creation or validation is a performance obligation. Revenue is recognized at the point when the block creation or validation is complete and the rewards are transferred into a digital wallet that the Company controls. Revenue is measured based on the number of tokens received and the fair value of the token at contract inception. Staking revenue does not include revenue from delegation services that are offered as part of Coinbase Cloud, which are included in Other subscription and services revenue.
Custodial fee revenue
The Company provides a dedicated secure cold storage solution to customers and earns a fee, which is based on a contractual percentage of the daily value of assets under custody. The fee is collected on a monthly basis. These contracts typically have one performance obligation which is provided and satisfied over the term of the contracts as customers simultaneously receive and consume the benefits of the services. The contract may be terminated by a customer at any time, without incurring a penalty. Customers are billed on the last day of the month during which services were provided, with the amounts being due within thirty days of receipt of the invoice.
Earn campaign revenue
The Company provides a platform for crypto asset issuers, the customer, to engage with the Company’s retail users and teach them about new crypto assets through the use of educational tools, videos, and tutorials. In exchange for completing a task, such as watching the video or downloading an application, retail users may be eligible to receive crypto assets from the crypto asset issuer. The Company is the agent with respect to the delivery of the crypto assets. The Company earns a commission from the crypto asset issuer based on the amount of crypto assets that are distributed to users.
Interest income and corporate interest and other income
The Company holds customer custodial funds and cash and cash equivalents at certain third-party banks which earn interest. The Company also earns interest income under a revenue sharing arrangement and on loans granted to retail and institutional users. Interest income is calculated using the interest method and is not within the scope of Topic 606 – Revenue from Contracts with Customers. Interest earned on customer custodial funds, revenue sharing, and loans is included in interest income within subscription and services revenue. Interest earned on cash and cash equivalents is included in corporate interest and other income, within other revenue.
Other subscription and services revenue
Other subscription and services revenue primarily includes revenue from Coinbase Cloud, which includes staking application, delegation, and infrastructure services, as well as revenue from subscription licenses. Generally, these contracts with customers contain one performance obligation, may have variable and non-cash consideration, and are satisfied at a point in time or over the period that services are provided.
Other revenue
Other revenue includes the sale of crypto assets and corporate interest and other income. Periodically, as an accommodation to customers, the Company may fulfill customer transactions using the Company’s own crypto assets held for operating purposes. The Company has custody and control of the crypto assets prior to the sale to the customer and records revenue at the point in time when the sale to the customer is processed. Accordingly, the Company records the total value of the sale in other revenue and the cost of the crypto assets in Other operating expense, net within the consolidated statements of operations.Related party transactionsCertain of the Company’s directors, executive officers, and principal owners, including immediate family members, are users of the Company’s platform.
Contract acquisition costs
Contract acquisition costs
The Company has elected to apply the practical expedient to recognize the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that would otherwise have been recognized is one year or less.
Transaction expense Transaction expenseTransaction expense includes costs incurred to operate the Company’s platform, process crypto asset trades, and perform wallet services. These costs include account verification fees, miner fees to process transactions on blockchain networks, fees paid to payment processors and other financial institutions for customer transaction activity, and crypto asset losses due to transaction reversals. Transaction expense also includes rewards paid to users for blockchain activities conducted by the Company, such as staking. Fixed-fee costs are expensed over the term of the contract and transaction-level costs are expensed as incurred.
Technology and development Technology and developmentTechnology and development expenses include personnel-related expenses incurred in operating, maintaining, and enhancing the Company’s platform. These costs also include website hosting, infrastructure expenses, costs incurred in developing new products and services and the amortization of acquired developed technology.
Sales and marketing and General and administrative
Sales and marketing
Sales and marketing expenses primarily include costs related to customer acquisition, advertising and marketing programs, and personnel-related expenses. Sales and marketing costs are expensed as incurred.
General and administrative
General and administrative expenses include personnel-related expenses incurred to support the Company’s business, including legal, finance, compliance, human resources, customer support, executive, and other support operations. These costs also include software subscriptions for support services, facilities and equipment costs, depreciation, amortization of acquired customer relationship intangible assets, gains and losses on disposal of fixed assets, legal reserves and settlements, and other general overhead. General and administrative costs are expensed as incurred.
Other operating expense, net
Other operating expense, net
Other operating expense, net includes cost of the Company’s crypto assets used to fulfill customer accommodation transactions. Periodically, as an accommodation to customers, the Company may fulfill customer transactions using its own crypto assets. The Company has custody and control of the crypto assets prior to the sale to the customer. Accordingly, the Company records the total value of the sale in other revenue and the cost of the crypto asset in other operating expense.
Other operating expense, net also includes impairment and realized gains on the sale of crypto assets, realized gains and losses resulting from the settlement of derivative instruments, and fair value gains and losses related to derivatives and derivatives designated in qualifying fair value hedge accounting relationships.
Stock-based compensation
Stock-based compensation
The Company recognizes stock-based compensation expense using a fair-value based method for costs related to all equity awards granted under its equity incentive plans to employees, directors and non-employees of the Company including restricted stock, restricted stock units (“RSUs”), stock options and purchase rights granted under the Company’s 2021 Employee Stock Purchase Plan (the "ESPP").
The fair value of restricted stock and RSUs is estimated based on the fair value of the Company’s common stock on the date of grant.
The Company estimates the fair value of stock options with only service-based conditions and purchase rights under the ESPP on the date of grant using the Black-Scholes-Merton option-pricing model. The model requires management to make a number of assumptions, including the fair value and expected volatility of the Company’s underlying common stock price, expected life of the option, risk-free interest rate, and expected dividend yield. The fair value of the underlying stock is the fair value of the Company’s common stock on the date of grant. The expected stock price volatility assumption for the Company’s stock is determined by using a weighted average of the historical stock price volatility of comparable companies from a representative peer group, as sufficient trading history for the Company’s common stock is not available. The Company uses historical exercise information and contractual terms of options to estimate the expected term. The risk-free interest rate for periods within the expected life of the option is based on the U.S. Treasury zero coupon bonds with terms consistent with the expected term of the award at the time of grant. The expected dividend yield assumption is based on the Company’s history and expectation of no dividend payouts.
Prior to the Direct Listing, the fair value of the underlying common stock was determined using the probability weighted expected return method, with a discounted cash flow model or a market multiples method used for each expected outcome. Following the Direct Listing, the fair value of the underlying common stock is the closing price of the Company’s Class A common stock as reported on the Nasdaq Global Select Market on the grant date.
Stock-based compensation expense is recorded on a straight-line basis over the requisite service period. The Company has elected to account for forfeitures of awards as they occur, with previously recognized compensation reversed in the period that the awards are forfeited.
Income taxes
Income taxes
The Company accounts for income taxes using the asset and liability method whereby deferred tax asset and liability account balances are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. A valuation allowance is established when management estimates that it is more likely than not that deferred tax assets will not be realized. Realization of deferred tax assets is dependent upon future pre-tax earnings, the reversal of temporary differences between book and tax income, and the expected tax rates in future periods.
The Company is required to evaluate the tax positions taken in the course of preparing its tax returns to determine whether tax positions are more likely than not of being sustained by the applicable tax authority. Tax benefits of positions not deemed to meet the “more-likely-than-not” threshold would be recorded as a tax expense in the current year. The amount recognized is subject to estimate and management judgment with respect to the likely outcome of each uncertain tax position. The amount that is ultimately sustained for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount that is initially recognized. It is the Company’s practice to recognize interest and penalties related to income tax matters in income tax expense.
For U.S. federal tax purposes, crypto asset transactions are treated on the same tax principles as property transactions. The Company recognizes a gain or loss when crypto assets are exchanged for other property, in the amount of the difference between the fair market value of the property received and the tax basis of the exchanged crypto assets. Receipts of crypto assets in exchange for goods or services are included in taxable income at the fair market value on the date of receipt.
Net income (loss) per share
Net income (loss) per share
The Company computes net income (loss) per share using the two-class method required for participating securities. The two-class method requires income available to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. The Company’s convertible preferred stock and certain of its restricted common stock were deemed participating securities. These participating securities do not contractually require the holders of such shares to participate in the Company’s losses.
Basic net income (loss) per share is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted net income (loss) per share is computed using the weighted-average number of outstanding shares of common stock and, when dilutive, potential shares of common stock outstanding during the period. Potential shares of common stock consist of incremental shares issuable upon the assumed exercise of stock options and warrants, vesting of RSUs, vesting of restricted common stock, conversion of the Company’s convertible preferred stock and convertible notes, and settlement of contingent consideration.
Segment reporting
Segment reporting
Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (the “CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company’s Chief Executive Officer is the Company’s CODM. The CODM reviews financial information presented on a global consolidated basis for purposes of making operating decisions, allocating resources, and evaluating financial performance. While the Company does have revenue from multiple products and geographies, no measures of profitability by product or geography are available, so discrete financial information is not available for each such component. As such, the Company has determined that it operates as one operating segment and one reportable segment.
Recent accounting pronouncements
Recent accounting pronouncements
Recently adopted accounting pronouncements
On June 16, 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update No. 2016-13, Financial Instruments - Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASU 2016-13 replaces the “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For available-for-sale debt securities, entities will be required to record allowances rather than reduce the carrying amount, as they do today under the other-than-temporary impairment model. It also simplifies the accounting model for purchased credit-impaired debt securities and loans. The Company adopted the standard on January 1, 2021 using the modified retrospective approach. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements, as the Company’s receivables are either fully collateralized or are short term in nature and therefore less susceptible to risks and uncertainty of credit losses over extended periods of time.
On August 29, 2018, the FASB issued Accounting Standards Update No. 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40)—Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which aligns the accounting for implementation costs incurred in a hosting arrangement that is a service contract with the accounting for implementation costs incurred to develop or obtain internal-use software under Accounting Standards Codification (“ASC”) 350-40, in order to determine which costs to capitalize and recognize as an asset and which costs to expense. The Company adopted the standard on January 1, 2021 using the prospective transition approach. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements.
On December 18, 2019, the FASB issued Accounting Standards Update No. 2019-12, Income Taxes: Simplifying the Accounting for Income Taxes, as part of its overall simplification initiative to reduce the costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. Among other things, the new guidance simplifies intraperiod tax allocation and reduces the complexity in accounting for income taxes with year-to-date losses in interim periods. The Company adopted the standard on January 1, 2021. The adoption of the standard did not have a material impact on the Company’s consolidated financial statements.
On August 5, 2020, the FASB issued Accounting Standards Update No. 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40) (“ASU 2020-06”). ASU 2020-06 simplifies accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity, by removing certain separation models that require the separation of a convertible debt instrument into a debt component and an equity or derivative component. ASU 2020-06 removes from U.S. GAAP the separation models for (1) convertible debt with a cash conversion feature and (2) convertible instruments with a beneficial conversion feature. After adoption of ASU 2020-06 entities will not separately present in equity an embedded conversion feature in such debt. Instead entities will account for a convertible debt instrument wholly as debt, and for convertible preferred stock wholly as preferred stock (i.e., as a single unit of account), unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC 815 or (2) a convertible instrument was issued at a substantial premium. ASU 2020-06 also expands disclosure requirements for convertible instruments and simplifies areas of the guidance for diluted earnings-per-share calculations that are impacted by the amendments. Under ASU 2020-06, entities must apply the more dilutive of the if-converted method and the two-class method to all convertible instruments; the treasury stock method is no longer available. ASU 2020-06 eliminates an entity’s ability to overcome the presumption of share settlement, and as a result, the issuers of convertible debt that may be settled in any combination of cash or stock at the issuer’s option, must use the more dilutive among the if-converted method and the two-class method in computing diluted net income per share, which is typically more dilutive than the net share settlement under the treasury stock method. ASU 2020-06 is effective for interim and annual periods beginning after December 15, 2021, with early adoption permitted. The Company early adopted ASU 2020-06 on January 1, 2021. The adoption of this new guidance did not have an impact on the Company’s consolidated financial statements since the Company had no existing convertible notes prior to issuance of the 2026 Convertible Notes, described below, in the second quarter of 2021. Further, the Company’s outstanding convertible preferred stock, which was converted into either Class A common stock or Class B common stock in conjunction with the Company’s Direct Listing, did not contain any beneficial conversion feature. The Company’s 2026 Convertible Notes are accounted for in accordance with this new guidance. See Note 11. Indebtedness for additional information.
Accounting pronouncements pending adoption
On October 28, 2021, the FASB issued Accounting Standards Update No. 2021-08, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU 2021-08”). ASU 2021-08 amends ASC 805 to require acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The new standard is effective for the Company for its fiscal year beginning January 1, 2023 and interim periods within its fiscal year beginning January 1, 2023. Early adoption is permitted. The Company is evaluating the impact of adopting this standard.
Loans receivable The Company’s credit exposure is significantly limited and no allowance was recorded against these loans receivable. Loans receivable are measured at amortized cost.
v3.22.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
 12 Months Ended
Dec. 31, 2021
Accounting Policies [Abstract]  
Schedule of Property and Equipment The estimated useful lives of the Company’s property, equipment, and software are generally as follows:
Property and equipmentUseful life
Furniture and fixtures
Three to five years
Computer equipment
Two to five years
Leasehold improvements
Lesser of useful life or remaining lease term
Capitalized software
One to three years
Property and equipment consisted of the following (in thousands):
December 31,
20212020
Furniture and fixtures$7,307 $7,161 
Construction in progress535 358 
Computers and equipment3,542 2,815 
Leasehold improvements43,048 40,589 
Capitalized software47,044 22,815 
Total cost101,476 73,738 
Accumulated depreciation and amortization(42,246)(24,488)
Total, net$59,230 $49,250 
v3.22.0.1
ACQUISITIONS (Tables)
 12 Months Ended
Dec. 31, 2021
Business Combination and Asset Acquisition [Abstract]  
Schedule of business acquisitions by acquisition
The total consideration transferred in the acquisition was $457.3 million, consisting of the following (in thousands):
Common stock of the Company$389,314 
Previously held interest on acquisition date10,863 
Cash28,726 
Replacement of Bison Trails options28,365 
Total purchase consideration$457,268 
The aggregate total preliminary consideration transferred in these acquisitions was $211.0 million, consisting of the following (in thousands):
Common stock of the Company - issued$65,717 
Common stock of the Company - to be issued58,173 
RSUs3,019 
Cash62,425 
Cash payable5,918 
Contingent consideration arrangement15,752 
Aggregate total purchase consideration$211,004 
The total consideration transferred in the acquisition was $41.8 million, consisting of the following (in thousands):
Common stock of the Company$30,589 
Replacement of Tagomi options and warrants760 
Cash1,906 
Settlement of pre-existing receivable8,537 
Total purchase consideration$41,792 
The total estimated consideration transferred in the acquisition consisted of the following (in thousands):
Cash$151,550 
Class A common stock of the Company103,977
RSUs for Shares of the Company’s Class A common stock2,457
Total estimated purchase consideration$257,984 
Schedule of recognized identified assets acquired and liabilities assumed The following table summarizes the fair values of assets acquired and liabilities assumed using a cost based approach (in thousands):
Cash and cash equivalents$12,201 
Crypto assets held5,177 
Accounts and loans receivable, net of allowance2,323 
Prepaid expenses and other current assets122 
Intangible assets39,100 
Goodwill404,167 
Other non-current assets1,221 
Lease right-of-use assets808 
Total assets465,119 
Accounts payable526 
Accrued expenses and other current liabilities1,920 
Lease liabilities808 
Other non-current liabilities4,597 
Total liabilities7,851 
Net assets acquired$457,268 
The following table summarizes the aggregate estimated fair values of assets acquired and liabilities assumed using a cost based approach (in thousands):
Cash and cash equivalents$8,039 
Accounts receivable, net of allowance57 
Prepaid expenses and other assets276 
Intangible assets62,100 
Goodwill144,379 
Total assets214,851 
Accounts payable359 
Accrued expenses and other current liabilities983 
Other non-current liabilities2,505 
Total liabilities3,847 
Net assets acquired$211,004 
The following table summarizes the fair values of assets acquired and liabilities assumed as of the date of acquisition (in thousands):
Cash and cash equivalents$13,777 
Customer custodial funds19,837 
Crypto assets held5,687 
Accounts and loans receivable, net of allowance5,795 
Prepaid expenses and other current assets633 
Intangible assets7,350 
Goodwill22,516 
Other non-current assets1,611 
Total assets77,206 
Custodial funds due to customers20,787 
Accounts payable5,887 
Accrued expenses and other current liabilities66 
Crypto borrowings8,674 
Total liabilities35,414 
Net assets acquired$41,792 
Schedule of components of finite lived and indefinite lived identifiable intangible assets acquired
The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands, except for years data):
Fair ValueUseful Life at Acquisition (in years)
Developed technology$36,000 3
In-process research and development ("IPR&D")1,200 N/A
User base1,900 3
The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the dates of acquisition of each transaction (in thousands, except for years data):
Fair ValueUseful Life at Acquisition (in years)
Developed technology$45,900 2.5
User base1,000 2.5
In process research and development2,300 N/A
Customer relationships12,900 4.3
The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (in thousands, except for years data):
Fair ValueUseful Life at Acquisition (in years)
Developed technology$6,600 3
Customer relationships400 5
Licenses350 Indefinite
v3.22.0.1
REVENUE (Tables)
 12 Months Ended
Dec. 31, 2021
Revenue from Contract with Customer [Abstract]  
Schedule of disaggregated revenue by source
The following table presents revenue of the Company disaggregated by revenue source (in thousands):
Year Ended December 31,
202120202019
Net revenue
Transaction revenue
Retail, net$6,490,992 $1,040,246 $432,919 
Institutional, net346,274 55,928 30,086 
Total transaction revenue6,837,266 1,096,174 463,005 
Subscription and services revenue
Blockchain rewards223,055 10,413 188 
Custodial fee revenue136,293 18,561 3,009 
Earn campaign revenue63,125 7,720 117 
Interest income25,835 5,535 14,414 
Other subscription and services revenue69,179 2,764 2,216 
Total subscription and services revenue517,487 44,993 19,944 
Total net revenue7,354,753 1,141,167 482,949 
Other revenue
Crypto asset sales revenue482,550 133,688 39,863 
Corporate interest and other income2,141 2,626 10,923 
Total other revenue484,691 136,314 50,786 
Total revenue$7,839,444 $1,277,481 $533,735 
Schedule of revenues disaggregated by geography
In the table below are the revenues disaggregated by geography, based on domicile of the customer or booking location, as applicable (in thousands):
Year Ended December 31,
202120202019
United States$6,339,270 $966,153 $417,260 
Rest of the World(1)
1,500,174 311,328 116,475 
Total revenue$7,839,444 $1,277,481 $533,735 
__________________
(1)No other individual country accounted for more than 10% of total revenue
v3.22.0.1
ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE (Tables)
 12 Months Ended
Dec. 31, 2021
Receivables [Abstract]  
Schedule of accounts receivable, net of allowance
Accounts and loans receivable, net of allowance consisted of the following (in thousands):
December 31,
20212020
In-transit customer receivables$102,720 $90,571 
Trade finance receivables1,865 66,326 
Custodial fee revenue receivable23,727 4,636 
Loans receivable(1)
218,461 6,790 
Interest and other receivables73,803 23,309 
Allowance for doubtful accounts(2)
(24,551)(2,161)
Total accounts and loans receivable, net of allowance$396,025 $189,471 
__________________
(1)The fair value of collateral held as security exceeded the outstanding loans receivable as of December 31, 2021 and December 31, 2020, so no allowance was recorded.
(2)Includes provision for transaction losses of $16.8 million and $1.3 million as of December 31, 2021 and December 31, 2020, respectively.
v3.22.0.1
LEASES (Tables)
 12 Months Ended
Dec. 31, 2021
Leases [Abstract]  
Components of Lease Cost
The components of lease cost were as follows (in thousands):
Year Ended December 31,
202120202019
Operating lease cost$34,074$30,231 $17,421 
Short-term lease cost374358 3,031 
Total lease cost$34,448 $30,589 $20,452 
Other information related to leases was as follows as of:
December 31,
20212020
Weighted-average remaining lease term (in years)2.04.1
Weighted-average discount rate3.02 %4.62 %
Maturities of Lease Liabilities
Maturities of lease liabilities were as follows (in thousands):
2022$36,268 
202335,266 
202432,630 
20259,036 
2026792 
Thereafter— 
Total lease payments113,992 
Less imputed interest(7,548)
Total$106,444 
v3.22.0.1
PROPERTY AND EQUIPMENT, NET (Tables)
 12 Months Ended
Dec. 31, 2021
Property, Plant and Equipment [Abstract]  
Schedule of Property and Equipment The estimated useful lives of the Company’s property, equipment, and software are generally as follows:
Property and equipmentUseful life
Furniture and fixtures
Three to five years
Computer equipment
Two to five years
Leasehold improvements
Lesser of useful life or remaining lease term
Capitalized software
One to three years
Property and equipment consisted of the following (in thousands):
December 31,
20212020
Furniture and fixtures$7,307 $7,161 
Construction in progress535 358 
Computers and equipment3,542 2,815 
Leasehold improvements43,048 40,589 
Capitalized software47,044 22,815 
Total cost101,476 73,738 
Accumulated depreciation and amortization(42,246)(24,488)
Total, net$59,230 $49,250 
Schedule of Long-lived Assets by Geographic Areas
Long-lived assets, which consisted of property and equipment, net and operating lease ROU assets, by geography were as follows (in thousands):
December 31,
20212020
United States$145,203 $148,199 
Rest of the World(1)
12,412 1,896 
Total long-lived assets$157,615 $150,095 
________________
(1)No other individual country accounted for more than 10% of total long-lived assets.
v3.22.0.1
GOODWILL AND INTANGIBLE ASSETS, NET (Tables)
 12 Months Ended
Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of goodwill
The following table reflects the changes in the carrying amount of goodwill (in thousands):
Year Ended December 31,
20212020
Balance, beginning of period$77,212 $54,696 
Additions due to business combinations548,546 22,516 
Balance, end of period$625,758 $77,212 
Schedule of finite-lived intangible assets
Intangible assets consisted of the following (in thousands, except years data):
As of December 31, 2021Gross Carrying AmountAccumulated AmortizationIntangible Assets, NetWeighted Average Remaining Useful Life (in years)
Amortizing intangible assets
Acquired developed technology$100,908 $(34,865)$66,043 1.97
User base2,997 (1,020)1,977 1.75
Customer relationships79,491 (27,789)51,702 3.68
Non-compete agreement2,402 (1,161)1,241 2.58
Assembled workforce60,800 (8,324)52,476 1.43
In-process research and development(1)
3,000 — 3,000 N/A
Indefinite-lived intangible assets
Domain name250 — 250 N/A
Crypto assets held(2)
988,193 — 988,193 N/A
Total$1,238,041 $(73,159)$1,164,882 
________________
(1)Amortization begins once the technology is placed in service. IPR&D is expected to have a useful life of three years.
(2)Crypto assets held as of December 31, 2021 includes $38.1 million of crypto assets loaned to customers under the trade finance receivables settlement arrangements as these did not meet the criteria for derecognition.
As of December 31, 2020Gross Carrying AmountAccumulated AmortizationIntangible Assets, NetWeighted Average Remaining Useful Life (in years)
Amortizing intangible assets
Acquired developed technology$20,708 $(13,024)$7,684 2.09
Customer relationships66,591 (15,771)50,820 4.58
Trade name30 (30)— 0
Non-compete agreement2,402 (681)1,721 3.58
Indefinite-lived intangible assets
Domain name250 — 250 N/A
Licenses350 — 350 N/A
Crypto assets held316,094 — 316,094 N/A
Total$406,425 $(29,506)$376,919 
Schedule of indefinite-lived intangible assets
Intangible assets consisted of the following (in thousands, except years data):
As of December 31, 2021Gross Carrying AmountAccumulated AmortizationIntangible Assets, NetWeighted Average Remaining Useful Life (in years)
Amortizing intangible assets
Acquired developed technology$100,908 $(34,865)$66,043 1.97
User base2,997 (1,020)1,977 1.75
Customer relationships79,491 (27,789)51,702 3.68
Non-compete agreement2,402 (1,161)1,241 2.58
Assembled workforce60,800 (8,324)52,476 1.43
In-process research and development(1)
3,000 — 3,000 N/A
Indefinite-lived intangible assets
Domain name250 — 250 N/A
Crypto assets held(2)
988,193 — 988,193 N/A
Total$1,238,041 $(73,159)$1,164,882 
________________
(1)Amortization begins once the technology is placed in service. IPR&D is expected to have a useful life of three years.
(2)Crypto assets held as of December 31, 2021 includes $38.1 million of crypto assets loaned to customers under the trade finance receivables settlement arrangements as these did not meet the criteria for derecognition.
As of December 31, 2020Gross Carrying AmountAccumulated AmortizationIntangible Assets, NetWeighted Average Remaining Useful Life (in years)
Amortizing intangible assets
Acquired developed technology$20,708 $(13,024)$7,684 2.09
Customer relationships66,591 (15,771)50,820 4.58
Trade name30 (30)— 0
Non-compete agreement2,402 (681)1,721 3.58
Indefinite-lived intangible assets
Domain name250 — 250 N/A
Licenses350 — 350 N/A
Crypto assets held316,094 — 316,094 N/A
Total$406,425 $(29,506)$376,919 
Crypto assets held consisted of the following (in thousands):
December 31,
20212020
Crypto assets held as investments$209,415 $24,438 
Crypto assets held for operating purposes357,093 37,830 
Crypto assets borrowed421,685 253,826 
Total crypto assets held
$988,193 $316,094 
Schedule of finite-lived intangible assets, future amortization expense
The expected future amortization expense for intangible assets other than IPR&D as of December 31, 2021 is as follows (in thousands):
2022$88,982 
202358,034 
202414,591 
20259,694 
20262,138 
Thereafter— 
Total expected future amortization expense$173,439 
v3.22.0.1
PREPAID EXPENSES AND OTHER ASSETS (Tables)
 12 Months Ended
Dec. 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Schedule of prepaid expenses and other current and non-current assets
Prepaid expenses and other current assets and other non-current assets consisted of the following (in thousands):
December 31,
20212020
Prepaid expenses and other current assets
Prepaid expenses$123,246 $36,218 
Warrant to purchase crypto assets— 2,575 
Deposits9,658 — 
Other2,945 717 
Total prepaid expenses and other current assets$135,849 $39,510 
Other non-current assets
Equity method investments$1,463 $2,000 
Strategic investments363,950 26,146 
Deferred tax assets573,547 20,807 
Deposits13,347 68,287 
Total other non-current assets$952,307 $117,240 
Schedule of other investments accounted for under the measurement alternative The components of strategic investments accounted for under the measurement alternative included in the table above are presented below (in thousands):
December 31,
20212020
Carrying amount, beginning of period$26,146 $15,599 
Net additions(1)
320,316 9,687 
Upward adjustments8,019 1,307 
Previously held interest in Bison Trails (see Note 3)(2,000)— 
Impairments and downward adjustments(50)(447)
Carrying amount, end of period(2)
$352,431 $26,146 
________________
(1)Net additions include additions from purchases and reductions due to exits of securities and reclassifications due to changes to capital structure.
(2)Excludes $11.5 million of strategic investments that are not accounted for under the measurement alternative.
v3.22.0.1
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)
 12 Months Ended
Dec. 31, 2021
Payables and Accruals [Abstract]  
Schedule of Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities consisted of the following (in thousands):
December 31,
20212020
Accrued expenses$195,810 $33,987 
Accrued payroll and payroll related146,313 23,403 
Income taxes payable4,553 5,805 
Other payables92,883 25,588 
Total accrued expenses and other current liabilities$439,559 $88,783 
v3.22.0.1
INDEBTEDNESS (Tables)
 12 Months Ended
Dec. 31, 2021
Debt Disclosure [Abstract]  
Schedule of Interest Expense
The following table summarizes the 2026 Convertible Notes, the 2028 Senior Notes and the 2031 Senior Notes (in thousands, except percentages):
Year Ended December 31, 2021
IndebtednessEffective interest rateCoupon interest expenseAmortization of debt discounts and debt issuance costsTotal interest expense
2026 Convertible Notes0.98 %$4,230 $4,311 $8,541 
2028 Senior Notes3.57 %9,732 435 10,167 
2031 Senior Notes3.77 %10,167 285 10,452 
Total$24,129 $5,031 $29,160 
v3.22.0.1
DERIVATIVES (Tables)
 12 Months Ended
Dec. 31, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of the notional amount of derivative contracts outstanding
The following table summarizes the notional amount of derivative contracts outstanding, in native units.
December 31,
20212020
Crypto asset borrowings with embedded derivatives:
BTC8,001 9,305 
ETH10,506 3,000 
ICP750,000 —
XRP— 1,500,000 
Warrant to purchase crypto assets:
UNI— 800,000 
The following tables summarize information on derivative assets and liabilities that are reflected in the consolidated balance sheets, by accounting designation (in thousands):
Gross derivative assetsGross derivative liabilities
December 31, 2021Not designated as hedgesDesignated as hedgesTotal derivative assetsNot designated as hedgesDesignated as hedgesTotal derivative liabilities
Crypto asset borrowings with embedded derivatives$— $336,396 $336,396 $— $93,616 $93,616 
Accounts receivable denominated in crypto assets9,033 — 9,033 — — — 
Total fair value of derivative assets and liabilities$9,033 $336,396 $345,429 $— $93,616 $93,616 
Gross derivative assetsGross derivative liabilities
December 31, 2020Not designated as hedgesDesignated as hedgesTotal derivative assetsNot designated as hedgesDesignated as hedgesTotal derivative liabilities
Crypto asset borrowings with embedded derivatives$— $— $— $12,696 $114,395 $127,091 
Warrant to purchase crypto assets2,575 — 2,575 — — — 
Total fair value of derivative assets and liabilities$2,575 $— $2,575 $12,696 $114,395 $127,091 
The following amounts were recorded in the consolidated balance sheets related to certain cumulative fair value hedge basis adjustments that are expected to reverse through the consolidated statements of operations in future periods as an adjustment to Other operating expense, net (in thousands):
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items
December 31, 2021Carrying amount of the hedged itemsActive hedging relationshipsDiscontinued hedging relationshipsTotal
Crypto assets held$421,685 $(240,771)$— $(240,771)
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items
December 31, 2020Carrying amount of the hedged itemsActive hedging relationshipsDiscontinued hedging relationshipsTotal
Crypto assets held$247,735 $113,102 $— $113,102 
Schedule of gains (losses) recorded in income
The following table presents derivative instruments used in fair value hedge accounting relationships, as well as pre-tax gains (losses) recorded on such derivatives and the related hedged items (in thousands):
Gains (losses) recorded in income
Year ended December 31, 2021Year ended December 31, 2020
DerivativesHedged itemsIncome statement impactDerivativesHedged itemsIncome statement impact
Crypto asset borrowings with embedded derivatives$87,730 $(70,577)$17,153 $(114,395)$113,102 $(1,293)
v3.22.0.1
FAIR VALUE MEASUREMENTS (Tables)
 12 Months Ended
Dec. 31, 2021
Fair Value Disclosures [Abstract]  
Schedule of fair value of assets and liabilities
The following table sets forth by level, within the fair value hierarchy, the Company’s assets and liabilities measured and recorded at fair value on a recurring basis (in thousands):
December 31, 2021December 31, 2020
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash and cash equivalents(1)
$4,813,621 $— $— $4,813,621 $212,818 $— $— $212,818 
Customer custodial funds(2)
3,566,072 — — 3,566,072 1,171,274 — — 1,171,274 
Crypto assets held(3)
— 421,685 — 421,685 — 247,735 — 247,735 
Derivative assets(4)(5)
— 345,429 — 345,429 — — 2,575 2,575 
Total assets$8,379,693 $767,114 $— $9,146,807 $1,384,092 $247,735 $2,575 $1,634,402 
Liabilities
Derivative liabilities(5)
$— $93,616 $— $93,616 $— $127,091 $— $127,091 
Contingent consideration arrangement— — 14,828 14,828 — — — — 
Total liabilities$— $93,616 $14,828 $108,444 $— $127,091 $— $127,091 
__________________
(1)Excludes corporate cash of $2.3 billion and $849.0 million held in deposit at financial institutions and crypto asset trading venues and not measured and recorded at fair value as of December 31, 2021 and December 31, 2020, respectively.
(2)Excludes customer custodial funds of $7.0 billion and $2.6 billion held in deposit at financial institutions and not measured and recorded at fair value as of December 31, 2021 and December 31, 2020, respectively.
(3)Includes crypto assets held that have been designated as hedged items in fair value hedges and excludes crypto assets of $566.5 million and $68.4 million held at cost as of December 31, 2021 and December 31, 2020, respectively.
(4)Level 3 derivative assets represent a warrant to purchase crypto assets, which are included in Prepaid expenses and other current assets in the consolidated balance sheets.
(5)Excludes crypto asset borrowings of $669.4 million and $144.2 million, representing the host liability contract which is not measured and recorded at fair value as of December 31, 2021 and December 31, 2020, respectively. Additionally, excludes the host contract of $17.4 million related to accounts receivable denominated in crypto assets as of December 31, 2021.
Schedule of assets measured at fair value on a recurring basis
The following table presents a reconciliation of the derivative asset measured at fair value on a recurring basis using significant unobservable inputs (in thousands):
Year Ended December 31,
20212020
Balance, beginning of period$2,575$—
Change in fair value14,7572,575
Exercise of warrant(17,332)—
Balance, end of period$—$2,575
Schedule of significant unobservable inputs The following significant unobservable inputs were used:
Year Ended December 31,
20212020
Discount rate
0.01% - 0.15%
0.07% - 0.12%
Historical volatility of comparable crypto assets
105% - 175%
90% - 125%
The following significant unobservable inputs were used:
Year Ended December 31,
20212020
Discount rate30.0 %17.5 %
Volatility of forecasted revenues146.1 %N/A
Long-term growth rateN/A3.0 %
Revenue growth rateN/A
3% - 61%
Schedule of liabilities measured at fair value on a recurring basis
The following table presents a reconciliation of the contingent consideration arrangement measured at fair value on a recurring basis using significant unobservable inputs (in thousands):
Year Ended December 31,
20212020
Balance, beginning of period$—$12,924
Fair value recorded in connection with acquisition15,752—
Change in fair value(924)3,281
Settlement—(16,205)
Balance, end of period$14,828$—
v3.22.0.1
CONVERTIBLE PREFERRED STOCK (Tables)
 12 Months Ended
Dec. 31, 2021
Temporary Equity Disclosure [Abstract]  
Schedule of convertible preferred stock
A summary of the Company’s authorized, issued, and outstanding shares of convertible preferred stock as of December 31, 2020, is presented in the following table (in thousands, except per share data).
As of December 31, 2020
Shares AuthorizedShares Issued and OutstandingOriginal Issue Price per ShareLiquidation PreferenceCarrying Value
FF Preferred5,739 5,739 $— $— $11 
Series A30,929 27,349 0.19721 5,394 4,946 
Series B25,416 21,831 1.00676 21,978 19,228 
Series C32,542 31,656 2.76488 87,525 83,146 
Series D17,471 17,471 8.25390 144,205 135,738 
Series E14,508 8,832 36.19220 319,648 319,398 
126,605 112,878 $578,750 $562,467 
Schedule of change in convertible preferred stock per class outstanding
The change in the number of outstanding shares of convertible preferred stock per class was as follows (in thousands):
Series FFSeries ASeries BSeries CSeries DSeries E
Balance at January 1, 20215,739 27,349 21,831 31,656 17,471 8,832 
Conversion to Class A common stock— (117)— (36)(43)(8,832)
Conversion to Class B common stock(5,739)(27,232)(21,831)(31,620)(17,428)— 
Balance at December 31, 2021— — — — — — 
v3.22.0.1
COMMON STOCK (Tables)
 12 Months Ended
Dec. 31, 2021
Equity [Abstract]  
Schedule of common stock reserved for issuance
The Company has reserved shares of Class A common stock and Class B common stock for issuance for the following purposes (in thousands):
December 31,
20212020
Class A common stock
Conversion of Series E convertible preferred stock— 8,832 
Options issued and outstanding under the 2013 Plan1,569 3,550 
Options issued and outstanding under the 2019 Plan29,311 37,232 
RSUs issued and outstanding under the 2019 Plan5,851 3,766 
Shares available for future issuance under the 2019 Plan— 2,193 
RSUs issued and outstanding under the 2021 Plan1,402 — 
Shares available for future issuance under the 2021 Plan35,856 — 
Shares available for future issuance under the 2021 Employee Stock Purchase Plan5,125 — 
Replacement options issued and outstanding from the Tagomi acquisition4 32 
Replacement options issued and outstanding from the Bison Trails acquisition223 — 
RSUs issued and outstanding from other acquisitions229 — 
Exercise and conversion of an outstanding warrant— 4 
Shares available for future issuance of warrants2,296 2,296 
Total Class A common stock shares reserved81,866 57,905 
Class B common stock
Conversion of FF Preferred and Series A, B, C, and D convertible preferred stock— 104,046 
Options issued and outstanding under the 2013 Plan6,101 22,442 
Exercise and conversion of an outstanding warrant— 408 
Total Class B common stock shares reserved6,101 126,896 
v3.22.0.1
STOCK-BASED COMPENSATION (Tables)
 12 Months Ended
Dec. 31, 2021
Share-based Payment Arrangement [Abstract]  
Schedule of activity of options outstanding
Activity of options outstanding are as follows (in thousands, except per share and years data):
Options OutstandingWeighted Average Exercise Price per ShareWeighted Average Remaining Contractual Life (Years)Aggregate Intrinsic Value
Balance at January 1, 202163,256 $14.84 8.17$2,527,396 
Assumed options from acquisition470 3.45 
Exercised(24,920)8.72 
Forfeited and cancelled(1,598)19.67 
Balance at December 31, 202137,208 $18.60 7.83$8,698,078 
Vested and exercisable at December 31, 202115,777 $14.90 7.14$3,746,507 
Vested and expected to vest at December 31, 202131,074 $17.64 7.67$7,293,948 
Schedule of share-based payment award, options, valuation assumptions
The assumptions used under the Black-Scholes-Merton option pricing model and the weighted average calculated value of the options granted to employees were as follows:
Year Ended December 31,
20212020
Dividend yield0.0 %0.0 %
Expected volatility44.0 %41.1 %
Expected term (in years)4.86.0
Risk-free interest rate0.5 %0.6 %
Schedule of activity of RSUs outstanding
Activity of RSUs outstanding under the Plans are as follows (in thousands, except per share data):
Number of sharesWeighted-Average Grant Date Fair Value Per Share
Balance at January 1, 20213,766 $54.80 
Granted6,433 233.24
Vested(2,421)194.60 
Forfeited and cancelled(296)200.85 
Balance at December 31, 20217,482 157.22 
Schedule of activity of restricted Class A common stock Activity of shares of restricted Class A common stock is as follows (in thousands, except per share data):
Number of sharesWeighted-Average Grant Date Fair Value Per Share
Balance at January 1, 2021824 $23.46 
Granted1,465 180.33
Vested(275)23.46 
Forfeited and cancelled— — 
Balance at December 31, 20212,014 137.57 
Schedule of stock based compensation
Stock-based compensation was included in the following components of expenses on the accompanying consolidated statements of operations (in thousands):
Year Ended December 31,
202120202019
Technology and development$571,861 $36,869 $25,220 
Sales and marketing32,944 1,566 970 
General and administrative215,880 34,190 24,699 
Restructuring— — 994 
Total$820,685 $72,625 $51,883 
v3.22.0.1
INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2021
Income Tax Disclosure [Abstract]  
Schedule of Income before Income Tax, Domestic and Foreign
The components of income (loss) before income taxes were attributable to the following regions (in thousands):
Year Ended December 31,
202120202019
Domestic$2,977,406$396,709$(55,383)
Foreign49,54112,4909,967
$3,026,947$409,199$(45,416)
Schedule of Components of Income Tax Expense (Benefit)
(Benefit from) provision for income taxes consisted of the following (in thousands):
Year Ended December 31,
202120202019
Current
Federal$(51,942)$65,269$2,053
State4,45618,162(639)
Foreign8,6422,9774,277
Total current(38,844)86,4085,691
Deferred
Federal(438,810)1,373(15,519)
State(93,959)(514)(5,496)
Foreign(25,560)(385)295
Total deferred(558,329)474(20,720)
Total (benefit from) provision for income taxes$(597,173)$86,882$(15,029)
Schedule of Effective Income Tax Rate Reconciliation
The effective income tax rate differs from the statutory federal income tax rate as follows:
Year Ended December 31,
202120202019
Provision for income taxes at U.S. statutory rate21.00 %21.00 %21.00 %
State income taxes, net of federal benefit(4.67)3.39 10.58 
Foreign rate differential(1.09)(0.24)(3.52)
Non-deductible compensation0.83 0.99 (2.20)
Equity compensation(31.95)0.27 2.31 
Prior year true-ups (state and federal)0.14 (0.11)1.51 
Research and development credits(9.60)(1.86)15.63 
Change in valuation allowance1.65 — — 
Foreign tax credit— (0.05)2.75 
Subpart F income— 0.09 (1.95)
Foreign Derived Intangible Income (“FDII”)— (1.50)— 
Global Intangible Low Taxed Income (“GILTI”)— 0.06 (1.15)
Uncertain tax positions3.07 0.46 (8.26)
CARES Act - NOL Carryback— (1.20)— 
Other0.89 (0.07)(3.61)
(19.73)%21.23 %33.09 %
Schedule of Deferred Tax Assets and Liabilities
Significant components of the Company’s deferred tax assets and liabilities consisted of the following (in thousands):
Year Ended December 31,
20212020
Deferred tax assets
Accruals and reserves$19,184$1,943
Net operating loss carryforward262,5746,322
Lease liability26,33829,845
Interest carryforward—1,047
Tax credits285,0294,584
Stock-based compensation50,29218,726
Intangibles7,3394,563
Book crypto asset impairments and realized losses37,9321,275
Other—1,045
Gross deferred tax assets688,68869,350
Less valuation allowance(54,383)(5,174)
Total deferred tax assets634,30564,176
Deferred tax liabilities
State taxes(973)(798)
Fixed assets and internally developed software(15,937)(11,391)
Prepaid expenses(3,439)(3,179)
Right of use asset(24,347)(28,001)
Installment gain(15,859)—
Other(203)—
Total deferred tax liabilities(60,758)(43,369)
Total net deferred tax assets$573,547$20,807
Schedule of Unrecognized Tax Benefits Roll Forward
Activity related to the Company’s unrecognized tax benefits consisted of the following (in thousands):
Year Ended December 31,
202120202019
Balance, beginning of year$12,807 $10,344 $6,605 
Increase related to tax positions taken during a prior year— 212 13 
Decreases related to tax positions taken during a prior year— (882)(77)
Increases related to tax positions taken during the current year98,212 3,133 3,803 
Balance, end of year$111,019 $12,807 $10,344 
v3.22.0.1
NET INCOME (LOSS) PER SHARE (Tables)
 12 Months Ended
Dec. 31, 2021
Earnings Per Share [Abstract]  
Schedule of computation of net income per share
The computation of net income (loss) per share is as follows (in thousands, except per share amounts):
Year Ended December 31,
202120202019
Basic net income (loss) per share:
Numerator
Net income (loss)$3,624,120 $322,317 $(30,387)
Less: Income allocated to participating securities(527,162)(214,061)— 
Net income (loss) attributable to common stockholders, basic$3,096,958 $108,256 $(30,387)
Denominator
Weighted-average shares of common stock used to compute net income per share attributable to common stockholders, basic177,319 68,671 61,317 
Net income (loss) per share attributable to common stockholders, basic$17.47 $1.58 $(0.50)
Diluted net income (loss) per share:
Numerator
Net income (loss)$3,624,120 $322,317 $(30,387)
Less: Income allocated to participating securities(439,229)(194,846)— 
Add: Interest on convertible notes6,208 — — 
Less: Fair value gain on contingent consideration arrangement (695)— — 
Net income (loss) attributable to common stockholders - diluted$3,190,404 $127,471 $(30,387)
Denominator
Weighted-average shares of common stock used to compute net income per share attributable to common stockholders, basic177,319 68,671 61,317 
Weighted-average effect of potentially dilutive securities:
Stock options36,396 22,146 — 
RSUs3,773 — — 
Restricted common stock9 — — 
Warrants72 392 — 
Convertible notes2,388 — — 
Contingent consideration8 — — 
Weighted-average shares of common stock used to compute net income (loss) per share attributable to common stockholders, diluted219,965 91,209 61,317 
Net income (loss) per share attributable to common stockholders, diluted$14.50 $1.40 $(0.50)
Schedule of potentially dilutive shares
The following potentially dilutive shares were not included in the calculation of diluted shares outstanding as the effect would have been anti-dilutive (in thousands):
Year Ended December 31,
202120202019
Employee stock options6,134 12,831 37,758 
RSUs151 3,766 — 
Warrants— — 408 
Restricted common stock5 — — 
Employee stock purchase plan295 — — 
Contingent consideration recognized in asset acquisition— — 691 
Convertible preferred stock— — 114,959 
Total6,585 16,597 153,816 
v3.22.0.1
Subsequent Events (Tables)
 12 Months Ended
Dec. 31, 2021
Subsequent Events [Abstract]  
Schedule of business acquisitions by acquisition
The total consideration transferred in the acquisition was $457.3 million, consisting of the following (in thousands):
Common stock of the Company$389,314 
Previously held interest on acquisition date10,863 
Cash28,726 
Replacement of Bison Trails options28,365 
Total purchase consideration$457,268 
The aggregate total preliminary consideration transferred in these acquisitions was $211.0 million, consisting of the following (in thousands):
Common stock of the Company - issued$65,717 
Common stock of the Company - to be issued58,173 
RSUs3,019 
Cash62,425 
Cash payable5,918 
Contingent consideration arrangement15,752 
Aggregate total purchase consideration$211,004 
The total consideration transferred in the acquisition was $41.8 million, consisting of the following (in thousands):
Common stock of the Company$30,589 
Replacement of Tagomi options and warrants760 
Cash1,906 
Settlement of pre-existing receivable8,537 
Total purchase consideration$41,792 
The total estimated consideration transferred in the acquisition consisted of the following (in thousands):
Cash$151,550 
Class A common stock of the Company103,977
RSUs for Shares of the Company’s Class A common stock2,457
Total estimated purchase consideration$257,984 
v3.22.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
USD ($)
segment
Dec. 31, 2020
USD ($)
Concentration Risk [Line Items]    
USDC held $ 100,096 $ 48,938
Number of operating segments | segment 1  
Number of reporting segments | segment 1  
Accounts and Loans Receivable | Customer Concentration Risk | Customer One    
Concentration Risk [Line Items]    
Accounts receivable   45,000
Accounts Receivable, Post Trade Credit | Customer Concentration Risk | Customer Two    
Concentration Risk [Line Items]    
Accounts receivable   $ 20,500
v3.22.0.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Useful life of Property, Plant and Equipment (Details)
 12 Months Ended
Dec. 31, 2021
Furniture and fixtures | Minimum  
Property, Plant and Equipment [Line Items]  
Useful life 3 years
Furniture and fixtures | Maximum  
Property, Plant and Equipment [Line Items]  
Useful life 5 years
Computer equipment | Minimum  
Property, Plant and Equipment [Line Items]  
Useful life 2 years
Computer equipment | Maximum  
Property, Plant and Equipment [Line Items]  
Useful life 5 years
Capitalized software | Minimum  
Property, Plant and Equipment [Line Items]  
Useful life 1 year
Capitalized software | Maximum  
Property, Plant and Equipment [Line Items]  
Useful life 3 years
v3.22.0.1
ACQUISITIONS - Narrative (Details)
$ in Thousands
 12 Months Ended
Feb. 08, 2021
USD ($)
shares
Jul. 31, 2020
USD ($)
shares
Dec. 31, 2021
USD ($)
businessCombination
tranche
shares
Dec. 31, 2020
USD ($)
Dec. 31, 2019
USD ($)
Business Acquisition [Line Items]          
Goodwill     $ 625,758 $ 77,212 $ 54,696
Bison Trails Co.          
Business Acquisition [Line Items]          
Gain on remeasurement $ 8,800        
Total purchase consideration $ 457,268        
Holdback release term 18 months        
Total acquisition costs $ 3,700        
Goodwill $ 404,167        
Bison Trails Co. | Class A common stock          
Business Acquisition [Line Items]          
Number of shares included in purchase consideration (in shares) | shares 496,434        
Other Acquisitions          
Business Acquisition [Line Items]          
Total purchase consideration     $ 211,000    
Number of businesses acquired | businessCombination     5    
Contingent consideration arrangement, number of tranches | tranche     2    
Goodwill     $ 144,379    
Goodwill, expected to be deductible     77,100    
Other Acquisitions | General and administrative          
Business Acquisition [Line Items]          
Total acquisition costs     4,300    
Other Acquisitions | Technology and development          
Business Acquisition [Line Items]          
Total acquisition costs     $ 5,500    
Other Acquisitions | Contingent Consideration Tranche One          
Business Acquisition [Line Items]          
Contingent consideration arrangement, settlement term     1 year    
Other Acquisitions | Contingent Consideration Tranche Two          
Business Acquisition [Line Items]          
Contingent consideration arrangement, settlement term     2 years    
Other Acquisitions | Class A common stock | Contingent Consideration Tranche One          
Business Acquisition [Line Items]          
Number of shares to be issued for contingent consideration (in shares) | shares     75,534    
Other Acquisitions | Class A common stock | Contingent Consideration Tranche Two          
Business Acquisition [Line Items]          
Number of shares to be issued for contingent consideration (in shares) | shares     75,534    
Other Acquisitions | Class A common stock | Common Stock, Not Subject to Indemnity Holdback          
Business Acquisition [Line Items]          
Number of shares included in purchase consideration (in shares) | shares     160,840    
Issuance term for shares included in purchase consideration     6 months    
Other Acquisitions | Class A common stock | Common Stock, Subject to indemnity Holdback          
Business Acquisition [Line Items]          
Number of shares included in purchase consideration (in shares) | shares     51,619    
Other Acquisitions | Class A common stock | Common Stock, Subject to indemnity Holdback | Minimum          
Business Acquisition [Line Items]          
Issuance term for shares included in purchase consideration     15 months    
Other Acquisitions | Class A common stock | Common Stock, Subject to indemnity Holdback | Maximum          
Business Acquisition [Line Items]          
Issuance term for shares included in purchase consideration     18 months    
Tagomi Holdings, Inc.          
Business Acquisition [Line Items]          
Total purchase consideration   $ 41,792      
Total acquisition costs   1,100      
Goodwill   $ 22,516      
Tagomi Holdings, Inc. | Class A common stock          
Business Acquisition [Line Items]          
Number of shares issued to related party (in shares) | shares   264,527      
v3.22.0.1
ACQUISITIONS - Schedule of Bison Trails purchase consideration (Details) - Bison Trails Co.
$ in Thousands
Feb. 08, 2021
USD ($)
Business Acquisition [Line Items]  
Equity interests issued and issuable $ 389,314
Previously held interest on acquisition date 10,863
Cash 28,726
Replacement of Bison Trails options 28,365
Total purchase consideration $ 457,268
v3.22.0.1
ACQUISITIONS - Schedule of Bison Trails net assets acquired (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Feb. 08, 2021
Dec. 31, 2020
Dec. 31, 2019
Business Acquisition [Line Items]        
Goodwill $ 625,758   $ 77,212 $ 54,696
Bison Trails Co.        
Business Acquisition [Line Items]        
Cash and cash equivalents   $ 12,201    
Crypto assets held   5,177    
Accounts and loans receivable, net of allowance   2,323    
Prepaid expenses and other current assets   122    
Intangible assets   39,100    
Goodwill   404,167    
Other non-current assets   1,221    
Lease right-of-use assets   808    
Total assets   465,119    
Accounts payable   526    
Accrued expenses and other current liabilities   1,920    
Lease liabilities   808    
Other non-current liabilities   4,597    
Total liabilities   7,851    
Net assets acquired   $ 457,268    
v3.22.0.1
ACQUISITIONS - Schedule of Bison Trails finite-lived intangible assets acquired (Details) - Bison Trails Co.
$ in Thousands
Feb. 08, 2021
USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 39,100
Developed technology  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 36,000
Useful Life at Acquisition (in years) 3 years
In-process research and development ("IPR&D")  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 1,200
User base  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 1,900
Useful Life at Acquisition (in years) 3 years
v3.22.0.1
ACQUISITIONS - Schedule of other acquisitions purchase consideration (Details) - Other Acquisitions
$ in Thousands
 12 Months Ended
Dec. 31, 2021
USD ($)
Business Acquisition [Line Items]  
Cash $ 62,425
Cash payable 5,918
Contingent consideration arrangement 15,752
Total purchase consideration 211,004
Common stock of the Company - issued  
Business Acquisition [Line Items]  
Equity interests issued and issuable 65,717
Common stock of the Company - to be issued  
Business Acquisition [Line Items]  
Equity interests issued and issuable 58,173
RSUs  
Business Acquisition [Line Items]  
Equity interests issued and issuable $ 3,019
v3.22.0.1
ACQUISITIONS - Schedule of other acquisitions net assets acquired (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Business Acquisition [Line Items]      
Goodwill $ 625,758 $ 77,212 $ 54,696
Other Acquisitions      
Business Acquisition [Line Items]      
Cash and cash equivalents 8,039    
Accounts and loans receivable, net of allowance 57    
Prepaid expenses and other current assets 276    
Intangible assets 62,100    
Goodwill 144,379    
Total assets 214,851    
Accounts payable 359    
Accrued expenses and other current liabilities 983    
Other non-current liabilities 2,505    
Total liabilities 3,847    
Net assets acquired $ 211,004    
v3.22.0.1
ACQUISITIONS - Schedule of other acquisitions finite-lived intangible assets acquired (Details) - Other Acquisitions
$ in Thousands
 12 Months Ended
Dec. 31, 2021
USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 62,100
Developed technology  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 45,900
Useful Life at Acquisition (in years) 2 years 6 months
User base  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 1,000
Useful Life at Acquisition (in years) 2 years 6 months
In-process research and development ("IPR&D")  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 2,300
Customer relationships  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 12,900
Useful Life at Acquisition (in years) 4 years 3 months 18 days
v3.22.0.1
ACQUISITIONS - 2020 Schedule of purchase consideration (Details) - Tagomi Holdings, Inc.
$ in Thousands
Jul. 31, 2020
USD ($)
Business Acquisition [Line Items]  
Equity interests issued and issuable $ 30,589
Replacement of Tagomi options and warrants 760
Cash 1,906
Settlement of pre-existing receivable 8,537
Total purchase consideration $ 41,792
v3.22.0.1
ACQUISITIONS - 2020 Schedule of assets acquired and liabilities assumed (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Jul. 31, 2020
Dec. 31, 2019
Business Acquisition [Line Items]        
Goodwill $ 625,758 $ 77,212   $ 54,696
Tagomi Holdings, Inc.        
Business Acquisition [Line Items]        
Cash and cash equivalents     $ 13,777  
Customer custodial funds     19,837  
Crypto assets held     5,687  
Accounts and loans receivable, net of allowance     5,795  
Prepaid expenses and other current assets     633  
Intangible assets     7,350  
Goodwill     22,516  
Other non-current assets     1,611  
Total assets     77,206  
Custodial funds due to customers     20,787  
Accounts payable     5,887  
Accrued expenses and other current liabilities     66  
Crypto borrowings     8,674  
Total liabilities     35,414  
Net assets acquired     $ 41,792  
v3.22.0.1
ACQUISITIONS - 2020 Schedule of finite lived and indefinite lived intangible assets (Details) - Tagomi Holdings, Inc.
$ in Thousands
Jul. 31, 2020
USD ($)
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 7,350
Developed technology  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 6,600
Useful Life at Acquisition (in years) 3 years
Customer relationships  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 400
Useful Life at Acquisition (in years) 5 years
Licenses  
Acquired Finite-Lived Intangible Assets [Line Items]  
Intangible assets $ 350
v3.22.0.1
REVENUE - Schedule of revenue disaggregated by source (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Disaggregation of Revenue [Line Items]      
Interest income $ 25,835 $ 5,535 $ 14,414
Total revenue 7,839,444 1,277,481 533,735
Net revenue      
Disaggregation of Revenue [Line Items]      
Total revenue 7,354,753 1,141,167 482,949
Transaction revenue      
Disaggregation of Revenue [Line Items]      
Revenue 6,837,266 1,096,174 463,005
Retail, net      
Disaggregation of Revenue [Line Items]      
Revenue 6,490,992 1,040,246 432,919
Institutional, net      
Disaggregation of Revenue [Line Items]      
Revenue 346,274 55,928 30,086
Subscription and services revenue      
Disaggregation of Revenue [Line Items]      
Revenue 517,487 44,993 19,944
Blockchain rewards      
Disaggregation of Revenue [Line Items]      
Revenue 223,055 10,413 188
Custodial fee revenue      
Disaggregation of Revenue [Line Items]      
Revenue 136,293 18,561 3,009
Earn campaign revenue      
Disaggregation of Revenue [Line Items]      
Revenue 63,125 7,720 117
Other subscription and services revenue      
Disaggregation of Revenue [Line Items]      
Revenue 69,179 2,764 2,216
Other revenue      
Disaggregation of Revenue [Line Items]      
Total revenue 484,691 136,314 50,786
Crypto asset sales revenue      
Disaggregation of Revenue [Line Items]      
Revenue 482,550 133,688 39,863
Corporate interest and other income      
Disaggregation of Revenue [Line Items]      
Corporate interest and other income $ 2,141 $ 2,626 $ 10,923
v3.22.0.1
REVENUE - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Disaggregation of Revenue [Line Items]      
Recognized revenue with related parties $ 29.1 $ 3.4 $ 0.7
Amounts receivable from related parties $ 4.5 0.6  
Custodial fee revenue      
Disaggregation of Revenue [Line Items]      
Payment period 30 days    
Amounts receivable from customers, net of allowance $ 22.4 4.4  
Crypto asset sales revenue      
Disaggregation of Revenue [Line Items]      
Cost of crypto assets used in fulfilling customer transactions $ 436.0 $ 131.9 $ 38.6
v3.22.0.1
REVENUE - Schedule of revenue disaggregated by geographic area (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Disaggregation of Revenue [Line Items]      
Total revenue $ 7,839,444 $ 1,277,481 $ 533,735
United States      
Disaggregation of Revenue [Line Items]      
Total revenue 6,339,270 966,153 417,260
Rest of the World      
Disaggregation of Revenue [Line Items]      
Total revenue $ 1,500,174 $ 311,328 $ 116,475
v3.22.0.1
ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE - Schedule of accounts and loans receivable (Details) - USD ($)
Dec. 31, 2021
Dec. 31, 2020
Accounts, Notes, Loans and Financing Receivable [Line Items]    
In-transit customer receivables $ 102,720,000 $ 90,571,000
Trade finance receivables 1,865,000 66,326,000
Custodial fee revenue receivable 23,727,000 4,636,000
Loans receivable 218,461,000 6,790,000
Interest and other receivables 73,803,000 23,309,000
Allowance for doubtful accounts (24,551,000) (2,161,000)
Total accounts and loans receivable, net of allowance 396,025,000 189,471,000
Financing receivable, allowance for credit loss, excluding accrued interest 0 0
Unlikely to be Collected Financing Receivable    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Allowance for doubtful accounts $ (16,800,000) $ (1,300,000)
v3.22.0.1
ACCOUNTS AND LOANS RECEIVABLE, NET OF ALLOWANCE - Narrative (Details) - USD ($)
Dec. 31, 2021
Dec. 31, 2020
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Financing receivable, excluding accrued interest, after allowance for credit loss, current $ 218,500,000 $ 6,800,000
Interest receivable (less than) 1,300,000 100,000
Financing receivable, allowance for credit loss, excluding accrued interest, current 0  
Loans receivable 218,461,000 6,790,000
Financial Asset, Past Due    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Loans receivable $ 0 $ 0
v3.22.0.1
LEASES - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Sep. 30, 2020
Lessee, Lease, Description [Line Items]        
Sublease income $ 6.7 $ 6.6 $ 2.8  
Cancellation fee       $ 7.9
Minimum commited spend after cancellation       $ 15.5
Minimum        
Lessee, Lease, Description [Line Items]        
Remaining lease term 1 year      
Remaining sublease term 10 months      
Maximum        
Lessee, Lease, Description [Line Items]        
Remaining lease term 5 years      
Remaining sublease term 3 years      
v3.22.0.1
LEASES - Lease Cost (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Leases [Abstract]      
Operating lease cost $ 34,074 $ 30,231 $ 17,421
Short-term lease cost 374 358 3,031
Total lease cost $ 34,448 $ 30,589 $ 20,452
v3.22.0.1
LEASES - Other Information Related to Leases (Details)
Dec. 31, 2021
Dec. 31, 2020
Leases [Abstract]    
Weighted-average remaining lease term (in years) 2 years 4 years 1 month 6 days
Weighted-average discount rate 3.02% 4.62%
v3.22.0.1
LEASES - Lease Maturity (Details)
$ in Thousands
Dec. 31, 2021
USD ($)
Leases [Abstract]  
2022 $ 36,268
2023 35,266
2024 32,630
2025 9,036
2026 792
Thereafter 0
Total lease payments 113,992
Less imputed interest (7,548)
Total $ 106,444
v3.22.0.1
PROPERTY AND EQUIPMENT, NET - Schedule of Property and Equipment (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Property, Plant and Equipment [Line Items]    
Total cost $ 101,476 $ 73,738
Accumulated depreciation and amortization (42,246) (24,488)
Total, net 59,230 49,250
Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Total cost 7,307 7,161
Construction in progress    
Property, Plant and Equipment [Line Items]    
Total cost 535 358
Computers and equipment    
Property, Plant and Equipment [Line Items]    
Total cost 3,542 2,815
Leasehold improvements    
Property, Plant and Equipment [Line Items]    
Total cost 43,048 40,589
Capitalized software    
Property, Plant and Equipment [Line Items]    
Total cost $ 47,044 $ 22,815
v3.22.0.1
PROPERTY AND EQUIPMENT, NET -Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Property, Plant and Equipment [Abstract]      
Depreciation $ 18.4 $ 14.3 $ 7.2
Capitalized software additions $ 22.2 $ 12.1 $ 9.5
v3.22.0.1
PROPERTY AND EQUIPMENT, NET - Long-lived Assets by Geographic Areas (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Long Lived Assets Held-for-sale [Line Items]    
Total long-lived assets $ 157,615 $ 150,095
United States    
Long Lived Assets Held-for-sale [Line Items]    
Total long-lived assets 145,203 148,199
Rest of the World    
Long Lived Assets Held-for-sale [Line Items]    
Total long-lived assets $ 12,412 $ 1,896
v3.22.0.1
GOODWILL AND INTANGIBLE ASSETS, NET - Schedule of goodwill (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Goodwill [Roll Forward]    
Balance, beginning of period $ 77,212 $ 54,696
Additions due to business combinations 548,546 22,516
Balance, end of period $ 625,758 $ 77,212
v3.22.0.1
GOODWILL AND INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]      
Accumulated impairment $ 0 $ 0 $ 0
Amortization expense of intangible assets 45,300,000 16,700,000 9,700,000
Impairment of intangible assets excluding crypto assets held 500,000 0 1,600,000
Impairment expense 329,200,000 $ 8,400,000 $ 700,000
Crypto asset impairment expense $ 119,400,000    
v3.22.0.1
GOODWILL AND INTANGIBLE ASSETS, NET - Schedule of intangible assets (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Finite-Lived Intangible Assets [Line Items]    
Accumulated Amortization $ (73,159) $ (29,506)
Total expected future amortization expense 173,439  
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
Total intangible assets, gross carrying amount 1,238,041 406,425
Total accumulated amortization (73,159) (29,506)
Intangible assets, net 1,164,882 376,919
Domain name    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets 250 250
Licenses    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets   350
Crypto assets held    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets 988,193 316,094
Crypto Assets, Loaned to Customers    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets 38,100  
Acquired developed technology    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross carrying amount 100,908 20,708
Accumulated Amortization (34,865) (13,024)
Total expected future amortization expense $ 66,043 $ 7,684
Weighted Average Remaining Useful Life (in years) 1 year 11 months 19 days 2 years 1 month 2 days
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
Total accumulated amortization $ (34,865) $ (13,024)
User base    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross carrying amount 2,997  
Accumulated Amortization (1,020)  
Total expected future amortization expense $ 1,977  
Weighted Average Remaining Useful Life (in years) 1 year 9 months  
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
Total accumulated amortization $ (1,020)  
Customer relationships    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross carrying amount 79,491 66,591
Accumulated Amortization (27,789) (15,771)
Total expected future amortization expense $ 51,702 $ 50,820
Weighted Average Remaining Useful Life (in years) 3 years 8 months 4 days 4 years 6 months 29 days
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
Total accumulated amortization $ (27,789) $ (15,771)
Trade name    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross carrying amount   30
Accumulated Amortization   (30)
Total expected future amortization expense   $ 0
Weighted Average Remaining Useful Life (in years)   0 years
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
Total accumulated amortization   $ (30)
Non-compete agreement    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross carrying amount 2,402 2,402
Accumulated Amortization (1,161) (681)
Total expected future amortization expense $ 1,241 $ 1,721
Weighted Average Remaining Useful Life (in years) 2 years 6 months 29 days 3 years 6 months 29 days
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
Total accumulated amortization $ (1,161) $ (681)
Assembled workforce    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross carrying amount 60,800  
Accumulated Amortization (8,324)  
Total expected future amortization expense $ 52,476  
Weighted Average Remaining Useful Life (in years) 1 year 5 months 4 days  
Intangible Assets, Net (Excluding Goodwill) [Abstract]    
Total accumulated amortization $ (8,324)  
In-process research and development    
Finite-Lived Intangible Assets [Line Items]    
Intangible assets, gross carrying amount 3,000  
Total expected future amortization expense $ 3,000  
In-process research and development | Pro Forma    
Finite-Lived Intangible Assets [Line Items]    
Finite-lived intangible asset useful life 3 years  
v3.22.0.1
GOODWILL AND INTANGIBLE ASSETS, NET - Crypto assets held (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Crypto assets held    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets $ 988,193 $ 316,094
Crypto assets held as investments    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets 209,415 24,438
Crypto assets held for operating purposes    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets 357,093 37,830
Crypto assets borrowed    
Indefinite-lived Intangible Assets [Line Items]    
Indefinite-lived intangible assets $ 421,685 $ 253,826
v3.22.0.1
GOODWILL AND INTANGIBLE ASSETS, NET - Schedule of future amortization expense (Details)
$ in Thousands
Dec. 31, 2021
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]  
2022 $ 88,982
2023 58,034
2024 14,591
2025 9,694
2026 2,138
Thereafter 0
Total expected future amortization expense $ 173,439
v3.22.0.1
PREPAID EXPENSES AND OTHER ASSETS - Schedule of prepaid expenses and other current and non-current assets (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Prepaid expenses and other current assets    
Prepaid expenses $ 123,246 $ 36,218
Warrant to purchase crypto assets 0 2,575
Deposits 9,658 0
Other 2,945 717
Total prepaid expenses and other current assets 135,849 39,510
Other non-current assets    
Equity method investments 1,463 2,000
Strategic investments 363,950 26,146
Deferred tax assets 573,547 20,807
Deposits 13,347 68,287
Total other non-current assets $ 952,307 $ 117,240
v3.22.0.1
PREPAID EXPENSES AND OTHER ASSETS - Schedule of other investments accounted for under the measurement alternative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Equity Securities without Readily Determinable Fair Value [Roll Forward]    
Carrying amount, beginning of period $ 26,146 $ 15,599
Net additions 320,316 9,687
Upward adjustments 8,019 1,307
Previously held interest in Bison Trails (see Note 3) (2,000) 0
Impairments and downward adjustments (50) (447)
Carrying amount, end of period 352,431 $ 26,146
Strategic investments that are not accounted for under the measurement alternative $ 11,500  
v3.22.0.1
PREPAID EXPENSES AND OTHER ASSETS - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Schedule of Equity Method Investments [Line Items]    
Upward adjustments due to remeasurement of investments $ 4.6 $ 1.6
Impairments and downward adjustments due to remeasurement of investments 0.5 0.5
Affiliated Entity    
Schedule of Equity Method Investments [Line Items]    
Purchase of preferred shares $ 203.1 $ 0.5
v3.22.0.1
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Schedule of accounts payable and accrued expenses (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Payables and Accruals [Abstract]    
Accrued expenses $ 195,810 $ 33,987
Accrued payroll and payroll related 146,313 23,403
Income taxes payable 4,553 5,805
Other payables 92,883 25,588
Total accrued expenses and other current liabilities $ 439,559 $ 88,783
v3.22.0.1
INDEBTEDNESS - Narrative (Details)
 1 Months Ended 12 Months Ended
May 31, 2021
USD ($)
$ / shares
May 18, 2021
USD ($)
$ / shares
Sep. 30, 2021
USD ($)
Dec. 31, 2021
USD ($)
Dec. 31, 2020
USD ($)
Dec. 31, 2019
USD ($)
Debt Instrument [Line Items]            
Proceeds from the issuance of convertible senior notes, net of issuance cost       $ 1,403,753,000 $ 0 $ 0
Purchase of capped calls   $ 90,100,000   $ 90,131,000 $ 0 $ 0
Initial strike price (in dollars per share) | $ / shares   $ 370.45        
Cap price of the Capped Calls (in dollars per share) | $ / shares   $ 478.00        
Convertible Senior Notes due 2026            
Debt Instrument [Line Items]            
Conversion ratio       2.6994    
Convertible Senior Notes due 2026 | Convertible Debt            
Debt Instrument [Line Items]            
Face amount of debt $ 1,440,000,000          
Stated interest rate 0.50%          
Proceeds from the issuance of convertible senior notes, net of issuance cost $ 1,420,000,000          
Original issue discount, percentage 1.00%          
Conversion ratio 0.0026994          
Conversion price (in dollars per share) | $ / shares $ 370.45          
Repurchase price, percentage 100.00%          
Original issue discount $ 14,400,000     $ 29,400,000    
Debt issuance costs $ 19,400,000          
Outstanding aggregate principal balance       1,440,000,000    
2028 and 2031 Senior Notes | Senior Notes            
Debt Instrument [Line Items]            
Payments of debt issuance costs     $ 24,000,000      
Percentage of principal to be redeemed     40.00%      
Repurchase price, percentage, after change in control triggering event     101.00%      
2028 Senior Notes | Senior Notes            
Debt Instrument [Line Items]            
Face amount of debt     $ 1,000,000,000      
Stated interest rate     3.375%      
Repurchase price, percentage     103.375%      
Original issue discount       11,600,000    
Outstanding aggregate principal balance       1,000,000,000    
2031 Senior Notes | Senior Notes            
Debt Instrument [Line Items]            
Face amount of debt     $ 1,000,000,000      
Stated interest rate     3.625%      
Repurchase price, percentage     103.625%      
Original issue discount       11,700,000    
Outstanding aggregate principal balance       $ 1,000,000,000    
v3.22.0.1
INDEBTEDNESS - Interest Expense (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Debt Instrument [Line Items]      
Coupon interest expense $ 24,129    
Amortization of debt discounts and debt issuance costs 5,031 $ 0 $ 0
Total interest expense $ 29,160    
Convertible Debt | 2026 Convertible Notes      
Debt Instrument [Line Items]      
Effective interest rate 0.98%    
Coupon interest expense $ 4,230    
Amortization of debt discounts and debt issuance costs 4,311    
Total interest expense $ 8,541    
Senior Notes | 2028 Senior Notes      
Debt Instrument [Line Items]      
Effective interest rate 3.57%    
Coupon interest expense $ 9,732    
Amortization of debt discounts and debt issuance costs 435    
Total interest expense $ 10,167    
Senior Notes | 2031 Senior Notes      
Debt Instrument [Line Items]      
Effective interest rate 3.77%    
Coupon interest expense $ 10,167    
Amortization of debt discounts and debt issuance costs 285    
Total interest expense $ 10,452    
v3.22.0.1
DERIVATIVES - Schedule of notional amount of derivative contracts outstanding (Details) - Not designated as hedges
Dec. 31, 2021
bitcoin
Dec. 31, 2021
ethereum
Dec. 31, 2021
internetComputer
Dec. 31, 2021
xRP
Dec. 31, 2021
uniswapToken
Dec. 31, 2020
bitcoin
Dec. 31, 2020
ethereum
Dec. 31, 2020
internetComputer
Dec. 31, 2020
xRP
Dec. 31, 2020
uniswapToken
Crypto asset borrowings with embedded derivatives:                    
Derivative [Line Items]                    
Notional amount of derivative contracts outstanding in native units 8,001 10,506 750,000 0   9,305 3,000 0 1,500,000  
Warrant to purchase crypto assets:                    
Derivative [Line Items]                    
Notional amount of derivative contracts outstanding in native units         0         800,000
v3.22.0.1
DERIVATIVES - Schedule of derivative assets and liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets $ 345,429 $ 2,575
Gross derivative liabilities 93,616 127,091
Crypto asset borrowings with embedded derivatives    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 336,396 0
Gross derivative liabilities 93,616 127,091
Accounts receivable denominated in crypto assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 9,033  
Gross derivative liabilities 0  
Warrant to purchase crypto assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets   2,575
Gross derivative liabilities   0
Not designated as hedges    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 9,033 2,575
Gross derivative liabilities 0 12,696
Not designated as hedges | Crypto asset borrowings with embedded derivatives    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 0 0
Gross derivative liabilities 0 12,696
Not designated as hedges | Accounts receivable denominated in crypto assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 9,033  
Gross derivative liabilities 0  
Not designated as hedges | Warrant to purchase crypto assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets   2,575
Gross derivative liabilities   0
Designated as hedges    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 336,396 0
Gross derivative liabilities 93,616 114,395
Designated as hedges | Crypto asset borrowings with embedded derivatives    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 336,396 0
Gross derivative liabilities 93,616 114,395
Designated as hedges | Accounts receivable denominated in crypto assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets 0  
Gross derivative liabilities $ 0  
Designated as hedges | Warrant to purchase crypto assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Gross derivative assets   0
Gross derivative liabilities   $ 0
v3.22.0.1
DERIVATIVES - Schedule of gains (losses) recorded in income (Details) - Crypto asset borrowings with embedded derivatives: - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Derivative [Line Items]    
Derivatives $ 87,730 $ (114,395)
Hedged items (70,577) 113,102
Income statement impact $ 17,153 $ (1,293)
v3.22.0.1
DERIVATIVES - Schedule of cumulative fair value hedge basis adjustments (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]    
Carrying amount of the hedged items, Crypto assets held $ 421,685 $ 247,735
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items, active hedging relationships, Crypto assets held (240,771) 113,102
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items, discontinued hedging relationships, Crypto assets held 0 0
Cumulative amount of fair value hedging adjustments included in the carrying amount of hedged items, total, Crypto assets held $ (240,771) $ 113,102
v3.22.0.1
DERIVATIVES - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Derivative [Line Items]    
Carrying value of the outstanding host contract $ 669,400,000 $ 144,200,000
Fair value of the embedded derivative assets 336,400,000 0
Fair value of the embedded derivative liabilities 93,600,000 127,100,000
Borrowing fees paid in crypto assets 11,800,000 $ 2,600,000
Affiliated Entity    
Derivative [Line Items]    
Fair value of the embedded derivative assets 1,300,000  
Fair value of the embedded derivative liabilities $ 500,000  
Minimum    
Derivative [Line Items]    
Borrowing rate on derivatives 0.00% 1.70%
Maximum    
Derivative [Line Items]    
Borrowing rate on derivatives 10.00% 10.00%
v3.22.0.1
FAIR VALUE MEASUREMENTS (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Cash and cash equivalents $ 7,123,478 $ 1,061,850 $ 548,945
Customer custodial funds excluded from fair value assets 7,000,000 2,600,000  
Crypto assets held at cost excluded from fair value assets 566,500 68,400  
Carrying value of the outstanding host contract 669,400 144,200  
Accounts receivable denominated in crypto assets 17,400    
Held in Deposit at Financial Institutions and Crypto Asset Trading Venues      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Cash and cash equivalents 2,300,000 849,000  
Fair Value, Recurring      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Cash and cash equivalents 4,813,621 212,818  
Customer custodial funds 3,566,072 1,171,274  
Crypto assets held 421,685 247,735  
Derivative assets 345,429 2,575  
Total assets 9,146,807 1,634,402  
Derivative liabilities 93,616 127,091  
Contingent consideration arrangement 14,828 0  
Total liabilities 108,444 127,091  
Level 1 | Fair Value, Recurring      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Cash and cash equivalents 4,813,621 212,818  
Customer custodial funds 3,566,072 1,171,274  
Crypto assets held 0 0  
Derivative assets 0 0  
Total assets 8,379,693 1,384,092  
Derivative liabilities 0 0  
Contingent consideration arrangement 0 0  
Total liabilities 0 0  
Level 2 | Fair Value, Recurring      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Cash and cash equivalents 0 0  
Customer custodial funds 0 0  
Crypto assets held 421,685 247,735  
Derivative assets 345,429 0  
Total assets 767,114 247,735  
Derivative liabilities 93,616 127,091  
Contingent consideration arrangement 0 0  
Total liabilities 93,616 127,091  
Level 3 | Fair Value, Recurring      
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]      
Cash and cash equivalents 0 0  
Customer custodial funds 0 0  
Crypto assets held 0 0  
Derivative assets 0 2,575  
Total assets 0 2,575  
Derivative liabilities 0 0  
Contingent consideration arrangement 14,828 0  
Total liabilities $ 14,828 $ 0  
v3.22.0.1
FAIR VALUE MEASUREMENTS - Schedule of assets measured at fair value on a recurring basis (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]    
Balance, beginning of period $ 2,575 $ 0
Change in fair value 14,757 2,575
Exercise of warrant (17,332) 0
Balance, end of period $ 0 $ 2,575
v3.22.0.1
FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($)
$ in Millions
 12 Months Ended
Aug. 27, 2020
Dec. 31, 2021
Class A common stock    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Issuance of equity instruments as consideration in business combination (in shares) 690,756  
Convertible Debt | Level 2 | Convertible Senior Notes due 2026    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Fair value of notes   $ 1,540
Senior Notes | Level 2 | 2028 and 2031 Senior Notes    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Fair value of notes   $ 1,860
Minimum    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Vesting period of warrants   1 year
Maximum    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Vesting period of warrants   4 years
v3.22.0.1
FAIR VALUE MEASUREMENTS - Schedule of derivative significant unobservable inputs (Details) - Warrant to purchase crypto assets: - Level 3 - Valuation Technique, Discounted Cash Flow
Dec. 31, 2021
Dec. 31, 2020
Minimum | Discount rate    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Derivative asset, measurement input 0.0001 0.0007
Minimum | Historical volatility of comparable crypto assets    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Derivative asset, measurement input 1.05 0.90
Maximum | Discount rate    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Derivative asset, measurement input 0.0015 0.0012
Maximum | Historical volatility of comparable crypto assets    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Derivative asset, measurement input 1.75 1.25
v3.22.0.1
FAIR VALUE MEASUREMENTS - Reconciliation of contingent consideration arrangement (Details) - Contingent Consideration - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]    
Beginning balance $ 0 $ 12,924
Fair value recorded in connection with acquisition 15,752 0
Change in fair value (924) 3,281
Settlement 0 (16,205)
Ending balance $ 14,828 $ 0
v3.22.0.1
FAIR VALUE MEASUREMENTS - Schedule of contingent consideration significant unobservable inputs (Details) - Valuation Technique, Discounted Cash Flow
Dec. 31, 2021
Dec. 31, 2020
Discount rate    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Significant unobservable inputs 0.300 0.175
Volatility of forecasted revenues    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Significant unobservable inputs 1.461  
Long-term growth rate    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Significant unobservable inputs   0.030
Revenue growth rate | Minimum    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Significant unobservable inputs   0.03
Revenue growth rate | Maximum    
Fair Value Measurement Inputs and Valuation Techniques [Line Items]    
Significant unobservable inputs   0.61
v3.22.0.1
CONVERTIBLE PREFERRED STOCK - Narrative (Details)
 12 Months Ended
Apr. 01, 2021
shares
Dec. 31, 2021
USD ($)
vote
director
$ / shares
shares
Dec. 31, 2020
$ / shares
shares
Class of Stock [Line Items]      
Shares authorized (in shares)   500,000,000 126,605,000
Shares issued (in shares)   0 112,878,000
Shares outstanding (in shares)   0 112,878,000
Threshold in aggregate net proceeds for conversion | $   $ 100,000,000  
Class A common stock      
Class of Stock [Line Items]      
Conversion of preferred stock (in shares) 8,556,952    
Class B common stock      
Class of Stock [Line Items]      
Conversion of preferred stock (in shares) 103,850,006    
Undesignated preferred stock      
Class of Stock [Line Items]      
Shares authorized (in shares) 500,000,000    
Series A      
Class of Stock [Line Items]      
Shares authorized (in shares)     30,929,000
Shares issued (in shares)     27,349,000
Shares outstanding (in shares)   0 27,349,000
Convertible preferred stock, votes per share | vote   10  
Convertible preferred stock, number of directors available to vote in | director   1  
Preferred stock, dividend rate, percentage   6.00%  
Original Issue Price per Share (in dollars per share) | $ / shares   $ 0.19721  
Series B      
Class of Stock [Line Items]      
Shares authorized (in shares)     25,416,000
Shares issued (in shares)     21,831,000
Shares outstanding (in shares)   0 21,831,000
Convertible preferred stock, votes per share | vote   10  
Preferred stock, dividend rate, percentage   6.00%  
Original Issue Price per Share (in dollars per share) | $ / shares   $ 1.00676  
Series C      
Class of Stock [Line Items]      
Shares authorized (in shares)     32,542,000
Shares issued (in shares)     31,656,000
Shares outstanding (in shares)   0 31,656,000
Convertible preferred stock, votes per share | vote   10  
Convertible preferred stock, number of directors available to vote in | director   1  
Preferred stock, dividend rate, percentage   6.00%  
Original Issue Price per Share (in dollars per share) | $ / shares   $ 2.76488  
Series D      
Class of Stock [Line Items]      
Shares authorized (in shares)     17,471,000
Shares issued (in shares)     17,471,000
Shares outstanding (in shares)   0 17,471,000
Convertible preferred stock, votes per share | vote   10  
Preferred stock, dividend rate, percentage   6.00%  
Original Issue Price per Share (in dollars per share) | $ / shares   $ 8.2539  
Series E      
Class of Stock [Line Items]      
Shares authorized (in shares)     14,508,000
Shares issued (in shares)     8,832,000
Shares outstanding (in shares)   0 8,832,000
Convertible preferred stock, votes per share | vote   1  
Preferred stock, dividend rate, percentage   6.00%  
Original Issue Price per Share (in dollars per share) | $ / shares   $ 36.1922  
Series FF      
Class of Stock [Line Items]      
Shares authorized (in shares)     5,739,000
Shares issued (in shares)     5,739,000
Shares outstanding (in shares)   0 5,739,000
Convertible preferred stock, votes per share | vote   10  
Original Issue Price per Share (in dollars per share) | $ / shares     $ 0
Conversion price (in dollars per share) | $ / shares   $ 1.00  
v3.22.0.1
CONVERTIBLE PREFERRED STOCK (Details) - USD ($)
$ / shares in Units, $ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Temporary Equity [Line Items]    
Shares Authorized (in shares) 500,000,000 126,605,000
Shares issued (in shares) 0 112,878,000
Shares outstanding (in shares) 0 112,878,000
Liquidation Preference $ 0 $ 578,750
Carrying Value $ 0 $ 562,467
Series FF    
Temporary Equity [Line Items]    
Shares Authorized (in shares)   5,739,000
Shares issued (in shares)   5,739,000
Shares outstanding (in shares) 0 5,739,000
Original Issue Price per Share (in dollars per share)   $ 0
Liquidation Preference   $ 0
Carrying Value   $ 11
Series A    
Temporary Equity [Line Items]    
Shares Authorized (in shares)   30,929,000
Shares issued (in shares)   27,349,000
Shares outstanding (in shares) 0 27,349,000
Original Issue Price per Share (in dollars per share) $ 0.19721  
Liquidation Preference   $ 5,394
Carrying Value   $ 4,946
Series B    
Temporary Equity [Line Items]    
Shares Authorized (in shares)   25,416,000
Shares issued (in shares)   21,831,000
Shares outstanding (in shares) 0 21,831,000
Original Issue Price per Share (in dollars per share) $ 1.00676  
Liquidation Preference   $ 21,978
Carrying Value   $ 19,228
Series C    
Temporary Equity [Line Items]    
Shares Authorized (in shares)   32,542,000
Shares issued (in shares)   31,656,000
Shares outstanding (in shares) 0 31,656,000
Original Issue Price per Share (in dollars per share) $ 2.76488  
Liquidation Preference   $ 87,525
Carrying Value   $ 83,146
Series D    
Temporary Equity [Line Items]    
Shares Authorized (in shares)   17,471,000
Shares issued (in shares)   17,471,000
Shares outstanding (in shares) 0 17,471,000
Original Issue Price per Share (in dollars per share) $ 8.2539  
Liquidation Preference   $ 144,205
Carrying Value   $ 135,738
Series E    
Temporary Equity [Line Items]    
Shares Authorized (in shares)   14,508,000
Shares issued (in shares)   8,832,000
Shares outstanding (in shares) 0 8,832,000
Original Issue Price per Share (in dollars per share) $ 36.1922  
Liquidation Preference   $ 319,648
Carrying Value   $ 319,398
v3.22.0.1
CONVERTIBLE PREFERRED STOCK - Schedule of change in convertible preferred stock per class (Details)
 12 Months Ended
Dec. 31, 2021
shares
Temporary Equity [Roll Forward]  
Beginning balance (in shares) 112,878,000
Ending balance (in shares) 0
Series FF  
Temporary Equity [Roll Forward]  
Beginning balance (in shares) 5,739,000
Ending balance (in shares) 0
Series FF | Class A common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) 0
Series FF | Class B common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (5,739,000)
Series A  
Temporary Equity [Roll Forward]  
Beginning balance (in shares) 27,349,000
Ending balance (in shares) 0
Series A | Class A common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (117,000)
Series A | Class B common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (27,232,000)
Series B  
Temporary Equity [Roll Forward]  
Beginning balance (in shares) 21,831,000
Ending balance (in shares) 0
Series B | Class A common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) 0
Series B | Class B common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (21,831,000)
Series C  
Temporary Equity [Roll Forward]  
Beginning balance (in shares) 31,656,000
Ending balance (in shares) 0
Series C | Class A common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (36,000)
Series C | Class B common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (31,620,000)
Series D  
Temporary Equity [Roll Forward]  
Beginning balance (in shares) 17,471,000
Ending balance (in shares) 0
Series D | Class A common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (43,000)
Series D | Class B common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (17,428,000)
Series E  
Temporary Equity [Roll Forward]  
Beginning balance (in shares) 8,832,000
Ending balance (in shares) 0
Series E | Class A common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) (8,832,000)
Series E | Class B common stock  
Temporary Equity [Roll Forward]  
Conversion to Class A common stock (in shares) 0
v3.22.0.1
COMMON STOCK - Narrative (Details)
Apr. 01, 2021
vote
shares
Dec. 31, 2021
shares
Dec. 31, 2020
shares
Oct. 01, 2018
vote
director
Jun. 30, 2014
$ / shares
shares
Class of Stock [Line Items]          
Number of directors available to vote in | director       2  
Shares authorized (in shares)   500,000,000 126,605,000    
Class B common stock          
Class of Stock [Line Items]          
Common stock, votes per share | vote       10  
Conversion of preferred stock (in shares) 103,850,006        
Common stock, authorized (in shares) 500,000,000 500,000,000 208,414,000    
Common stock, voting rights per share | vote 20        
Common stock, conversion ratio 1        
Number of securities called by warrants (shares)         407,928
Exercise price of warrant (in usd per share) | $ / shares         $ 1.0068
Class A common stock          
Class of Stock [Line Items]          
Common stock, votes per share | vote       1  
Conversion of preferred stock (in shares) 8,556,952        
Common stock, authorized (in shares) 10,000,000,000 10,000,000,000 267,640,000    
Common stock, voting rights per share | vote 1        
Undesignated common stock          
Class of Stock [Line Items]          
Common stock, authorized (in shares) 500,000,000        
Undesignated preferred stock          
Class of Stock [Line Items]          
Shares authorized (in shares) 500,000,000        
v3.22.0.1
COMMON STOCK - Schedule of shares reserved for future issuance (Details) - shares
Dec. 31, 2021
Dec. 31, 2020
Class A common stock    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 81,866,000 57,905,000
Conversion of Series E convertible preferred stock    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 0 8,832,000
Options issued and outstanding under the 2013 Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 1,569,000 3,550,000
Options issued and outstanding under the 2019 Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 29,311,000 37,232,000
RSUs issued and outstanding under the 2019 Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 5,851,000 3,766,000
Shares available for future issuance under the 2019 Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 0 2,193,000
RSUs issued and outstanding under the 2021 Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 1,402,000 0
Shares available for future issuance under the 2021 Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 35,856,000 0
Shares available for future issuance under the 2021 Employee Stock Purchase Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 5,125,000 0
Replacement options issued and outstanding from the Tagomi acquisition    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 4,000 32,000
Replacement options issued and outstanding from the Bison Trails acquisition    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 223,000 0
RSUs issued and outstanding from other acquisitions    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 229,000 0
Exercise and conversion of an outstanding warrant    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 0 4,000
Shares available for future issuance of warrants    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 2,296,000 2,296,000
Class B common stock    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 6,101,000 126,896,000
Conversion of FF Preferred and Series A, B, C, and D convertible preferred stock    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 0 104,046,000
Options issued and outstanding under the 2013 Plan    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 6,101,000 22,442,000
Exercise and conversion of an outstanding warrant    
Class of Stock [Line Items]    
Common stock reserved for future issuance (in shares) 0 408,000
v3.22.0.1
STOCK-BASED COMPENSATION - Narrative (Details)
$ / shares in Units, $ in Thousands
 1 Months Ended 12 Months Ended
Jul. 08, 2021
shares
Aug. 11, 2020
USD ($)
$ / shares
shares
Apr. 30, 2021
Feb. 28, 2021
Dec. 31, 2021
USD ($)
equity_plan
$ / shares
shares
Dec. 31, 2020
USD ($)
$ / shares
shares
Dec. 31, 2019
USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Number of equity incentive plans | equity_plan         4    
Assumed options from acquisition (in shares) | shares         470,000    
Options assumed from acquisition, weighted average exercise price per share (in dollars per share) | $ / shares         $ 3.45    
Share based payment arrangement, capitalized         $ 3,500 $ 3,000 $ 2,600
Total unrecognized compensation cost related to unvested stock options         180,900    
Aggregate intrinsic value         $ 5,900,000 $ 38,300  
Number of options vested (in shares) | shares         14,966,504 7,936,075  
Weighted average grant date fair value (in dollars per share) | $ / shares         $ 8.74 $ 5.47  
Stock based compensation expense         $ 820,685 $ 72,625 $ 51,883
Chief Executive Officer              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Total grant date fair value   $ 56,700          
2021 Equity Incentive Plan              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Term of annual increase in shares authorized     10 years        
Annual increase in shares authorized     5.00%        
2019 Plan              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Contractual period (up to)         7 years    
Award requisite service period         2 years    
Class A common stock              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Assumed options from acquisition (in shares) | shares         470,128    
Options assumed from acquisition, weighted average exercise price per share (in dollars per share) | $ / shares         $ 110.97    
Granted (in shares) | shares           32,200,586  
Granted, weighted average grant date fair value (in usd per share) | $ / shares         $ 7.85    
Class A common stock | Chief Executive Officer              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Granted (in shares) | shares   9,293,911          
Options granted, weighted average exercise price per share (in dollars per share) | $ / shares   $ 23.46          
Stock options              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Contractual period (up to)         10 years    
Threshold percentage for exercise price of estimate fair value of underlying shares         100.00%    
Threshold percentage for exercise price of estimate fair value of underlying shares of shareholder with ten or more percent of voting power         110.00%    
Unrecognized compensation cost, weighted-average period of recognition         2 years 9 months 18 days    
Number of shares subject to repurchase (in shares) | shares         478,271 263,761  
Value of shares related to repurchase         $ 8,900 $ 4,600  
Stock options | Share-based Payment Arrangement, Tranche Two              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Vesting rights, percentage         2.08%    
Stock options | New Employees              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock based compensation vesting period         4 years    
Stock options | New Employees | Share-based Payment Arrangement, Tranche One              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Vesting rights, percentage         25.00%    
Stock options | Existing Employees              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock based compensation vesting period         4 years    
Employee stock purchase plan | Chief Executive Officer              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Number of options vested (in shares) | shares 3,159,930            
Stock based compensation expense         $ 29,500 0  
RSUs              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Unrecognized compensation cost, weighted-average period of recognition         2 years 6 months 7 days    
Total unrecognized compensation cost         $ 1,000,000    
Granted (in shares) | shares         6,433,000    
RSUs | Director              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock based compensation expense           $ 9,900  
Granted (in shares) | shares           181,000  
RSUs | Minimum              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock based compensation vesting period         1 year    
RSUs | Maximum              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock based compensation vesting period         4 years    
Restricted common stock              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock based compensation vesting period         3 years    
Unrecognized compensation cost, weighted-average period of recognition         2 years 1 month 24 days    
Total unrecognized compensation cost         $ 207,600    
Granted (in shares) | shares         1,465,000    
Employee stock purchase plan              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Stock based compensation expense         $ 9,400    
Stock plan offering period       24 months      
Period for automatic share increase         10 years    
Percentage of outstanding stock maximum         1.00%    
Accumulated payroll deductions         $ 7,400    
Employee stock purchase plan | Class A common stock              
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]              
Discount on purchase price of common stock       15.00%      
v3.22.0.1
STOCK-BASED COMPENSATION - Schedule of stock option activity (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Options Outstanding    
Beginning balance (in shares) 63,256  
Assumed options from acquisition (in shares) 470  
Exercised (in shares) (24,920)  
Forfeited and cancelled (in shares) (1,598)  
Ending balance (in shares) 37,208 63,256
Weighted Average Exercise Price per Share    
Options outstanding, weighted average exercise price per share - Beginning balance (in dollars per share) $ 14.84  
Options assumed from acquisition, weighted average exercise price per share (in dollars per share) 3.45  
Options exercised, weighted average exercise price per share (in dollars per share) 8.72  
Options forfeited and cancelled, weighted average exercise price per share (in dollars per share) 19.67  
Options outstanding, weighted average exercise price per share - Ending balance (in dollars per share) $ 18.60 $ 14.84
Stock Option Activity, Additional Disclosures    
Options outstanding, Weighted average remaining contractual term 7 years 9 months 29 days 8 years 2 months 1 day
Options outstanding, Aggregate intrinsic value $ 8,698,078 $ 2,527,396
Options vested and exercisable, Number of options (in shares) 15,777  
Options vested and exercisable , Weighted average exercise price per share (in dollars per share) $ 14.90  
Options vested and exercisable, Weighted average remaining contractual term 7 years 1 month 20 days  
Options vested and exercisable, Aggregate intrinsic value $ 3,746,507  
Options vested and expected to vest, Number of options (in shares) 31,074  
Options vested and expected to vest, Weighted average exercise price per share (in dollars per share) $ 17.64  
Options vested and expected to vest, Weighted average remaining contractual term 7 years 8 months 1 day  
Options vested and expected to vest, Aggregate intrinsic value $ 7,293,948  
v3.22.0.1
STOCK-BASED COMPENSATION - Valuation Assumptions (Details) - Stock options
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Dividend yield 0.00% 0.00%
Expected volatility 44.00% 41.10%
Expected term (in years) 4 years 9 months 18 days 6 years
Risk-free interest rate 0.50% 0.60%
v3.22.0.1
STOCK-BASED COMPENSATION - Schedule of restricted stock unit and restricted stock activity (Details)
shares in Thousands
 12 Months Ended
Dec. 31, 2021
$ / shares
shares
RSUs  
Number of shares  
Beginning balance (in shares) | shares 3,766
Granted (in shares) | shares 6,433
Vested (in shares) | shares (2,421)
Forfeited and cancelled (in shares) | shares (296)
Ending balance (in shares) | shares 7,482
Weighted-Average Grant Date Fair Value Per Share  
Beginning balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 54.80
Granted, Weighted-average grant date fair value per share (in dollars per share) | $ / shares 233.24
Vested, Weighted-average grant date fair value per share (in dollars per share) | $ / shares 194.60
Forfeited and cancelled, Weighted-average grant date fair value per share (in dollars per share) | $ / shares 200.85
Ending balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 157.22
Restricted common stock  
Number of shares  
Beginning balance (in shares) | shares 824
Granted (in shares) | shares 1,465
Vested (in shares) | shares (275)
Forfeited and cancelled (in shares) | shares 0
Ending balance (in shares) | shares 2,014
Weighted-Average Grant Date Fair Value Per Share  
Beginning balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 23.46
Granted, Weighted-average grant date fair value per share (in dollars per share) | $ / shares 180.33
Vested, Weighted-average grant date fair value per share (in dollars per share) | $ / shares 23.46
Forfeited and cancelled, Weighted-average grant date fair value per share (in dollars per share) | $ / shares 0
Ending balance, weighted-average grant date fair value per share (in dollars per share) | $ / shares $ 137.57
v3.22.0.1
STOCK-BASED COMPENSATION - Schedule of stock based compensation (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock based compensation expense $ 820,685 $ 72,625 $ 51,883
Technology and development      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock based compensation expense 571,861 36,869 25,220
Sales and marketing      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock based compensation expense 32,944 1,566 970
General and administrative      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock based compensation expense 215,880 34,190 24,699
Restructuring      
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]      
Stock based compensation expense $ 0 $ 0 $ 994
v3.22.0.1
INCOME TAXES - Schedule of Income before Income Tax, Domestic and Foreign (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Income Tax Disclosure [Abstract]      
Domestic $ 2,977,406 $ 396,709 $ (55,383)
Foreign 49,541 12,490 9,967
Income (loss) before income taxes $ 3,026,947 $ 409,199 $ (45,416)
v3.22.0.1
INCOME TAXES - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Current      
Federal $ (51,942) $ 65,269 $ 2,053
State 4,456 18,162 (639)
Foreign 8,642 2,977 4,277
Total current (38,844) 86,408 5,691
Deferred      
Federal (438,810) 1,373 (15,519)
State (93,959) (514) (5,496)
Foreign (25,560) (385) 295
Total deferred (558,329) 474 (20,720)
Total (benefit from) provision for income taxes $ (597,173) $ 86,882 $ (15,029)
v3.22.0.1
INCOME TAXES - Schedule of Effective Income Tax Rate Reconciliation (Details)
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Income Tax Disclosure [Abstract]      
Provision for income taxes at U.S. statutory rate 21.00% 21.00% 21.00%
State income taxes, net of federal benefit (4.67%) 3.39% 10.58%
Foreign rate differential (1.09%) (0.24%) (3.52%)
Non-deductible compensation 0.83% 0.99% (2.20%)
Equity compensation (31.95%) 0.27% 2.31%
Prior year true-ups (state and federal) 0.14% (0.11%) 1.51%
Research and development credits (9.60%) (1.86%) 15.63%
Change in valuation allowance 1.65% 0.00% 0.00%
Foreign tax credit 0.00% (0.05%) 2.75%
Subpart F income 0.00% 0.09% (1.95%)
Foreign Derived Intangible Income (“FDII”) 0.00% (1.50%) 0.00%
Global Intangible Low Taxed Income (“GILTI”) 0 0.0006 (0.0115)
Uncertain tax positions 3.07% 0.46% (8.26%)
CARES Act - NOL Carryback 0.00% (1.20%) 0.00%
Effective Income Tax Rate Reconciliation, Other Adjustments, Percent 0.89% (0.07%) (3.61%)
Effective income tax rate reconciliation, percent, total (19.73%) 21.23% 33.09%
v3.22.0.1
INCOME TAXES - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2021
Dec. 31, 2020
Deferred tax assets    
Accruals and reserves $ 19,184 $ 1,943
Net operating loss carryforward 262,574 6,322
Lease liability 26,338 29,845
Interest carryforward 0 1,047
Tax credits 285,029 4,584
Stock-based compensation 50,292 18,726
Intangibles 7,339 4,563
Book crypto asset impairments and realized losses 37,932 1,275
Other 0 1,045
Gross deferred tax assets 688,688 69,350
Less valuation allowance (54,383) (5,174)
Total deferred tax assets 634,305 64,176
Deferred tax liabilities    
State taxes (973) (798)
Fixed assets and internally developed software (15,937) (11,391)
Prepaid expenses (3,439) (3,179)
Right of use asset (24,347) (28,001)
Installment gain (15,859) 0
Other (203) 0
Total deferred tax liabilities (60,758) (43,369)
Total net deferred tax assets $ 573,547 $ 20,807
v3.22.0.1
INCOME TAXES - Narrative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Dec. 31, 2018
Tax Credit Carryforward [Line Items]        
Valuation allowance $ 54,383 $ 5,174    
Unrecognized tax benefits 111,019 12,807 $ 10,344 $ 6,605
Unrecognized tax benefits that would impact effective tax rate 84,900 12,300    
Decrease in unrecognized tax benefits is reasonably possible 7,500      
Unrecognized tax benefits that would favorably impact effective tax rate 4,500      
Unrecognized tax benefits, interest on income taxes accrued 600 400    
Unrecognized tax benefits, income tax penalties accrued 600 400    
Domestic Tax Authority        
Tax Credit Carryforward [Line Items]        
Operating loss carryforwards 873,600 24,500    
State and Local Jurisdiction        
Tax Credit Carryforward [Line Items]        
Operating loss carryforwards $ 1,100,000      
Operating loss carryforwards, expiration period 20 years      
Research Tax Credit Carryforward        
Tax Credit Carryforward [Line Items]        
Valuation allowance $ 45,400      
Tax credit carryforward $ 108,300 $ 4,600    
v3.22.0.1
INCOME TAXES - Schedule of Unrecognized Tax Benefits Roll Forward (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]      
Balance, beginning of year $ 12,807 $ 10,344 $ 6,605
Increase related to tax positions taken during a prior year 0 212 13
Decreases related to tax positions taken during a prior year 0 (882) (77)
Increases related to tax positions taken during the current year 98,212 3,133 3,803
Balance, end of year $ 111,019 $ 12,807 $ 10,344
v3.22.0.1
NET INCOME (LOSS) PER SHARE - Schedule of net income per share (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Numerator      
Net income (loss) $ 3,624,120 $ 322,317 $ (30,387)
Less: Income allocated to participating securities (527,162) (214,061) 0
Net income (loss) attributable to common stockholders, basic $ 3,096,958 $ 108,256 $ (30,387)
Denominator      
Weighted-average shares of common stock used to compute net income per share attributable to common stockholders, basic (in shares) 177,319 68,671 61,317
Net income (loss) per share attributable to common stockholders, basic (in dollars per share) $ 17.47 $ 1.58 $ (0.50)
Numerator      
Net income (loss) $ 3,624,120 $ 322,317 $ (30,387)
Less: Income allocated to participating securities (439,229) (194,846) 0
Add: Interest on convertible notes 6,208 0 0
Less: Fair value gain on contingent consideration arrangement (695) 0 0
Net income (loss) attributable to common stockholders - diluted $ 3,190,404 $ 127,471 $ (30,387)
Denominator      
Weighted-average shares of common stock used to compute net income per share attributable to common stockholders, basic (in shares) 177,319 68,671 61,317
Weighted-average effect of potentially dilutive securities:      
Warrants (in shares) 72 392 0
Convertible notes (in shares) 2,388 0 0
Contingent consideration (in shares) 8 0 0
Weighted-average shares of common stock used to compute net income (loss) per share attributable to common stockholders, diluted (in shares) 219,965 91,209 61,317
Net income (loss) per share attributable to common stockholders, diluted (in dollars per share) $ 14.50 $ 1.40 $ (0.50)
Stock options      
Weighted-average effect of potentially dilutive securities:      
Share-based compensation plan (in shares) 36,396 22,146 0
RSUs      
Weighted-average effect of potentially dilutive securities:      
Share-based compensation plan (in shares) 3,773 0 0
Restricted common stock      
Weighted-average effect of potentially dilutive securities:      
Share-based compensation plan (in shares) 9 0 0
v3.22.0.1
NET INCOME (LOSS) PER SHARE - Schedule of potentially dilutive shares (Details) - shares
shares in Thousands
 12 Months Ended
Dec. 31, 2021
Dec. 31, 2020
Dec. 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 6,585 16,597 153,816
Employee stock options      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 6,134 12,831 37,758
RSUs      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 151 3,766 0
Warrants      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 0 0 408
Restricted common stock      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 5 0 0
Employee stock purchase plan      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 295 0 0
Contingent consideration recognized in asset acquisition      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 0 0 691
Convertible Preferred Stock      
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]      
Number of shares excluded in the computation of diluted earnings per share 0 0 114,959
v3.22.0.1
COMMITMENTS AND CONTINGENCIES (Details)
 2 Months Ended
Aug. 31, 2021
class_action_case
Commitments and Contingencies Disclosure [Abstract]  
Number of purported securities class actions filed 3
v3.22.0.1
Subsequent Events - Schedule of Purchase Consideration (Details) - Subsequent Event - Unbound Security, Inc.
$ in Thousands
Jan. 04, 2022
USD ($)
Subsequent Event [Line Items]  
Cash $ 151,550
Equity interests issued and issuable 103,977
Purchase consideration 257,984
RSUs  
Subsequent Event [Line Items]  
Equity interests issued and issuable $ 2,457