Bullish’s Earnings Signal a Compliance CeFi Reality Check: Growth Is Real, but So Are the Risks

We don’t often get a clean signal from the market that the “compliance-first” crypto thesis is actually working. But last week, Bullish—the NYSE American-listed exchange spawned from Block.one’s EOS legacy—gave us three numbers that deserve more than a quick glance: a 10% stock price pop, an adjusted EBITDA that more than doubled, and a record high in subscription and service revenue. On the surface, that’s a home run for a company that went public via SPAC just four months ago. But as someone who has spent the last nine years watching DeFi summer rise and fall, auditing smart contracts for governance concentration, and building community around the idea that decentralization is a spectrum, not a binary, I’ve learned that the most dangerous narratives are the ones that feel too comfortable. This article is not about hyping Bullish. It’s about pulling apart what these numbers really mean for the compliance CeFi model, where the risks are hiding, and why the next quarter will tell us more than the last one ever could. Let’s start with the context that the headlines left out. Bullish is not your typical crypto exchange. It was founded in 2021 by Block.one, the company behind the EOS blockchain, and it raised $10 billion in initial liquidity—yes, billion—from a consortium that included Peter Thiel, BlackRock, and Louis Bacon. Its CEO is Tom Farley, former president of the New York Stock Exchange. Its chairman is Brendan Blumer, the founder of Block.one. This is a team that blends traditional finance credibility with crypto-native ambition. In November 2024, Bullish merged with Far Peak Acquisition Corp., a SPAC, and began trading under the ticker BULL. The valuation at merger was around $9 billion. Since then, the crypto market has seen a recovery, the FIT21 Act passed in May 2025, clarifying the regulatory boundaries between CFTC and SEC, and institutional interest in compliant venues has surged. Against this backdrop, the earnings report came out. The three data points—stock price up 10%, adjusted EBITDA more than doubled, subscription and service revenue at an all-time high—are not just numbers. They are the first real test of whether the “compliance CeFi” narrative can produce actual financial results beyond the hype. Now, let’s dive into the core. The adjusted EBITDA growth of over 2x is the headline grabber, but it’s also the most nuanced. EBITDA, especially “adjusted” EBITDA, is a metric that companies love to use because it excludes things like interest, taxes, depreciation, and amortization—and sometimes a lot more. From my experience auditing failed DeFi protocols during the 2022 bear market, I learned that the “adjusted” column is where the skeletons live. Bullish has not disclosed the full breakdown of its EBITDA adjustments, but based on the current interest rate environment, a significant portion of that growth could be coming from interest income on customer stablecoin deposits. The Fed rates were still above 4% in early 2025, and exchanges like Bullish that hold billions in customer assets can generate substantial interest revenue. That’s real income, but it’s not recurring in the same way that trading fees are—it’s tied to monetary policy. If the Fed cuts rates, that revenue stream shrinks. The subscription and service revenue hitting an all-time high is actually the more interesting signal. It suggests that Bullish is diversifying away from pure transaction fee dependency. Subscription revenue could include institutional account fees, API access, custody services, staking-as-a-service, or even listing fees for tokens. The fact that it’s at an all-time high indicates that the institutional client base is growing, and that these clients are willing to pay for consistent, compliant access. But here’s the catch: the article did not disclose the absolute figures or the percentage of total revenue. Without that, we can’t tell if subscription revenue is a growing slice of the pie or just a side dish that happened to peak in a high-volume quarter. The stock price reaction of 10% is a moderate positive. In the context of a 2x EBITDA growth, I would have expected a larger move. That suggests the market is pricing in some skepticism. Maybe it’s the SPAC hangover—SPAC stocks often underperform post-merger due to incentive misalignment and early investor lockup expirations. Or maybe the market is waiting for more granular data on user growth, trading volume, and the composition of that subscription revenue. Either way, the 10% move is a “yes, but” signal, not a full-throated endorsement. Now, the contrarian angle. The most dangerous assumption here is that these numbers represent a sustainable shift in the business model. Freedom isn’t measured by the absence of regulation, but by the ability to choose your constraints. Bullish has chosen the constraints of a public company—SEC filings, quarterly audits, Sarbanes-Oxley compliance. That’s a moat against the kind of collapse we saw with FTX, but it’s also a cost center. The real test for Bullish is not whether it can grow EBITDA in a bull market, but whether it can maintain that growth when the crypto market turns sideways. Let’s be honest: the first quarter of 2025 was a favorable period. Bitcoin hit new all-time highs, the FIT21 passed, and the fear of regulatory uncertainty was at a low. Bullish’s subscription revenue could be partially inflated by one-time events like token listing fees from projects rushing to get on a compliant exchange before the SEC’s new rules take effect. If that’s the case, the subscription revenue is not truly recurring. Additionally, the SPAC structure brings its own set of risks. The lockup period for early investors typically lasts 6 to 12 months. If Bullish’s lockup expired recently or is about to expire, the 10% stock price increase could be a prelude to a wave of insider selling. The stock price chart of many SPAC companies shows a pattern: pop on good news, then drift down as early investors exit. Bullish is not immune to that. And then there’s the technical risk. Bullish operates its own blockchain, Bullish Chain, which is a fork of EOSIO. But the developer ecosystem around it is minuscule compared to Ethereum or even Solana. The exchange’s value proposition is not about technological innovation—it’s about being a compliant gateway. That’s fine, but it means that Bullish’s growth is tied to the overall health of the crypto market and the attractiveness of the US regulatory regime. If the next administration changes the regulatory tone, or if a new DeFi paradigm emerges that makes centralized exchanges obsolete, Bullish’s moat could evaporate. The team is strong, but the team’s strengths are in traditional finance, not in the kind of rapid, permissionless innovation that defines the edge of crypto. What does this mean for the next six months? The takeaway is not about buying or selling BULL. It’s about what Bullish’s data tells us about the broader market. The compliance CeFi model is not dead—it’s producing real earnings, and that will attract more traditional capital. But the metrics we need to watch are not the ones in the headline. We need to see the subscription revenue as a percentage of total revenue. We need to see the breakdown of adjusted EBITDA adjustments. We need to see the user growth and trading volume trends. Most importantly, we need to see the next quarter’s data. A single quarter of strong numbers does not a trend make. The real test is whether Bullish can repeat this performance in a less favorable environment. If the next earnings show that subscription revenue continued to grow even as trading volume dipped, then we can start talking about a genuine business model transformation. Until then, this is a positive signal, but not a definitive one. We don’t build the future by celebrating the first victory. We build it by questioning every victory until we understand what it’s made of. Bullish’s numbers are made of real user activity, real regulatory clarity, and real execution. But they are also made of interest rates, SPAC mechanics, and the euphoria of a market that just got its rules. The next chapter will tell us which ingredients are structural and which are seasonal. Freedom isn’t the absence of risk—it’s the ability to see it clearly. And right now, the clarity is only partial. Keep your eyes on the subscription revenue breakdown and the lockup calendar. Everything else is just noise. This article is built by our shared vision of a financial system that is both compliant and innovative. Bullish is one experiment in that vision. The data is promising, but the experiment is far from over.