Cryptocurrency infrastructure company BitGo recorded a net loss last year despite significant revenue growth.
According to cryptocurrency media outlet BeInCrypto, BitGo recorded a net loss of $14.8 million last year. It is analyzed that valuation losses on held assets due to the decline in Bitcoin prices had a direct impact on performance.
In particular, as of the fourth quarter of last year, BitGo incurred an unrealized loss of approximately $50 million on the Bitcoin it held. Although this was a book loss rather than a realized loss, it was reflected in net income under accounting standards, putting pressure on profitability.
On the other hand, external growth was significant. BitGo demonstrated the speed of its business expansion by recording $16.15 billion in revenue, a 424% surge year-over-year. This is attributed to the rapid increase in demand for institutional custody, trading, and payment infrastructure.
These earnings results once again demonstrate the structural characteristics of cryptocurrency companies. For companies holding highly volatile digital assets, profits and losses can fluctuate significantly depending on market prices, regardless of actual business performance.
In particular, despite the continued growth of institution-focused infrastructure companies in the recent market, gains and losses on asset valuation are acting as a key variable amplifying earnings volatility. This suggests that accounting standards and risk management strategies are likely to emerge as increasingly important factors in corporate valuation in the future.
