Google, a subsidiary of Alphabet Inc. (NASDAQ: GOOGL), has acknowledged that the decline in the value of digital assets that sparked the current crypto winter has a negative impact on the money spent on searches.
The internet giant mostly blamed a slowdown in revenue growth on a decline in ad spending by financial institutions, especially those that deal with cryptocurrency holdings.
Google’s Chief Business Officer Philipp Schindler said on Tuesday, October 27, at an earnings call for Google’s parent company Alphabet, that the company observed a decline in search spending during the third quarter.
We did see a reduction in spending by certain marketers in specific search categories during the third quarter. For instance, in the financial services sector, we saw a decline in the subcategories of bitcoin, loans, and insurance, according to Schindler.
With the exception of the start of the Covid-19 epidemic, CNBC stated that the three-month period witnessed an overall rise in advertising of 6%, making it Google’s worst quarter since 2013.
Google CEO Sundar Pichai attributes this trend to the difficult macro climate and its impact on the advertising business. Ad revenue for Youtube has also declined on an annual basis.
Major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) had a decline in value of almost 60% in 2022 when compared to their all-time highs. Since then, there have been several bankruptcies of hedge funds and lenders, including Celsius Network, Voyager Digital, and Three Arrows Capital, as well as budget cuts for businesses like Blockchain.com and Crypto.com.
The largest cryptocurrency exchange in the United States, Coinbase, which went public in 2021, has slashed its staff by 18% this year, and the value of its shares has dropped by 70%. Google announced a partnership with a bitcoin trading platform in the third quarter of this year.
Google announced plans to partner with Coinbase to allow customers to start using cryptocurrency to pay for its cloud services in 2023. This shows that the IT giant has great hopes that the crypto winter will pass quickly. Furthermore, it’s predicted that Coinbase would move its data-related applications to Google’s cloud infrastructure.
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