Payward, the parent of crypto exchange Kraken, made just $23 million in adjusted pretax profit last quarter. That is 71% less than a year earlier, according to a shareholder letter seen by Bloomberg.

The easy explanation is a crypto slump. The numbers say otherwise. Payward’s revenue rose 17% to $508 million while its largest rival got smaller.

Coinbase Shrank, Payward Grew

Coinbase files full accounts with the US Securities and Exchange Commission (SEC) every quarter. Its report for the same three months shows revenue of $1.22 billion. That is down 18% from a year earlier.

COINBASE JUST REPORTED EARNINGS*COINBASE Q2 REV. $1.22 B, EST. $1.29B ( MISS ❌ )COINBASE 1Q EPS – $1.36, EST. – $0.42 ( MISS ❌ )*COINBASE Q2 TRANSACTION REV. $599 M, EST. $635 M ( MISS ❌ )*COINBASE Q2 SUBSCPTION REV. $555 M, EST. $594 M ( MISS ❌ )$COIN pic.twitter.com/LAp1i35mUF

— GURGAVIN (@gurgavin) July 30, 2026

So the two exchanges moved in opposite directions. One lost nearly a fifth of its revenue. The other added nearly a fifth. Coinbase also booked a $359 million net loss. Most of that came from the falling value of crypto it holds.

The read is awkward for the simple story. Trading fees fell across the industry. Payward’s newer businesses covered the gap. A slow market does not explain why its profit almost vanished.

The Bill for $2.65 Billion of Shopping

Payward has been buying companies for 18 months. It paid $1.5 billion for futures broker NinjaTrader in March 2025. In April this year it agreed to buy derivatives platform Bitnomial for up to $550 million.

Three weeks later came Reap, a stablecoin payments firm, for up to $600 million. Three further deals carried no public price. Backed in January. Token manager Magna in February. The wallet arm of Magic Labs in July.

The disclosed total is roughly $2.65 billion. The true figure is higher.

None of this was an accident. Co-CEO Arjun Sethi said as much in the first-quarter release, when profit had already thinned to $18 million.

“Where others pulled back, we leaned in – because our conviction hasn’t wavered, and we believe the investments we’re making will define our competitive position for years to come,” Sethi, quoted in a Payward statement.

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What Payward Will Not Show You

Payward is private, so it chooses what to publish. The letter gave two adjusted figures and stopped there. Adjusted numbers are not audited. Coinbase’s are.

The letter skips integration costs. It skips cash burn. It skips the split between revenue Payward built and revenue it bought.

That last gap is the one that counts. The 17% rise is the entire case for the strategy. Nobody outside the company can test it.

Payward filed confidentially for a US listing in November 2025. It then raised $800 million at a $20 billion valuation. Jane Street and DRW Venture Capital backed the round. It paused the listing in March. It cut 150 jobs in May and kept buying.

Those investors hold a $20 billion mark and no way to check it. The S-1 will show everything. Until it lands, they are asked to read a 71% drop as an investment.