FTX’s 2021 Revenue Shot Up By 1000%, Is It Real?

As per the latest reports, crypto exchange FTX had a crazy year in 2021 garnering more than a billion dollars in revenue. On Saturday, August 20, CNBC got access to the internal documents of the company giving them a glimpse into the company’s audited financials.

As per the CNBC report, FTX’s revenue soared more than 1000% last year from $89 million to $1.02 billion. FTX’s operating income in 2021 jumped to $272 million, up from $14 million a year ago in 2020. Similarly, the company’s net income stood at $388 million last year, a massive surge from $17 million a year before.

This year in 2022, crypto exchange FTX has been on a strong acquisition spree. It is also making investments into crypto businesses that have been facing the heat of the crypto winter. As per sources familiar with the matter, FTX is on track to clock $1.1 billion in revenue in 2022. The CNBC report notes:

FTX had roughly $2.5 billion in cash at the end of last year and 27% profit margins, according to the documents. Margins were closer to 50% if advertising and “related party” expenses are stripped out.

Earlier this year in January, FTX had secured $400 million in funding from VC giants like Tiger Global and SoftBank taking the company valuation to more than $32 billion.

Taking ON The Giants

Founded just three years back by Sam Bankman-Fried, crypto exchange is competing with giants like Coinbase and Binance. In order to compete, the company has been building its own fleet of crypto subsidiaries.

Amid a very strong balance sheet, FTX has been looking to buy some of the distressed assets recently. As a result, the crypto exchange has poured several million dollars into different crypto firms. Last month in July 2022, FTX signed a deal to buy crypto lender BlockFi. It was also in discussions to acquire South Korean exchange Bithumb. Besides, it has been acquiring more stake in several smaller crypto firms spread across multiple countries.

In the U.S, the crypto exchange operates under its parent firm, West Realm Shires Inc. Last year in 2021, FTX U.S. contributed less than 5% of its total revenue.