The massive price hike seen in Bitcoin (BTC-USD) has been giving all sorts of crypto stocks more oomph lately. However, the virtual currency exchange Coinbase (Nasdaq: Coin) had its own life cut short today as a court reversal proved a reversal in stock price. Shares fell more than 2% in afternoon trading Wednesday after taking a hit from the Securities and Exchange Commission (SEC) itself.
A lawsuit from the SEC has hit Coinbase, and the lawsuit is already underway. Things haven’t been particularly smooth for Coinbase, either, with a judge ruling that the SEC’s claims that Coinbase engaged in “unregistered sales of securities” could be tried by a jury if it goes to trial. It was judged. Coinbase tried to have the idea rejected, but the judge wouldn’t buy it.
The lawsuit dates back to June, when the SEC alleged that Coinbase was “…acting as an unregistered broker and exchange.” But the news wasn’t all bad. The SEC’s claim that Coinbase was acting as an unregistered broker through its wallet application was rejected.
More difficulties await
Coinbase took a hit with its staking program. Staking is when a cryptocurrency owner locks their tokens into a blockchain network. This provides owner compensation, almost like interest. Added to this are recent issues surrounding KuCoin operations (KCS-USD), putting pressure on the entire crypto market.
However, some analysts have warned that Bitcoin itself could be primed for a short squeeze due to the growing divergence between institutional investors and hedge funds. Hedge funds hold large amounts of short-term contracts, the people said. Kitoko According to the report, institutional investors were providing significant long positions.
Is Coinbase a buy, sell or hold?
Turning to Wall Street, analysts are positive on COIN stock based on 9 buys, 10 holds, and 4 sells assigned over the past three months, as shown in the chart below. We have a consensus rating of Hold. The average COIN price target of $189.38 per share implies a downside risk of 26.67% after the stock has gained 313.10% over the past year.
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