September 21, 2023

Wall Street Players Not Surprised by SEC Lawsuit Against Coinbase

Wall Street analysts weren't surprised by the massive U.S. Securities and Exchange Commission lawsuit against Coinbase, which was announced on Tuesday.

The SEC lawsuit against Coinbase was well publicized and should not come as a surprise,” said Mark Palmer, an equity analyst at Berenberg Capital Markets.

Crypto researcher at Needham & Company John Todaro expressed a similar opinion:

Following Wells' notice and Kraken's shutdown of its US staking business earlier this year, this was highly likely.

And despite the lawsuit, analysts are stillbullish on Coinbase stock. According to The Block Research, COIN's average target price is $69.17, up from $61.72 in January. In addition, 37% of analysts recommended buying shares even on June 5, compared to 33% in January.

Wall Street Players Not Surprised by SEC Lawsuit Against Coinbase

Palmer noted that the company's rating is maintained, although it is under review. He added that the upside potential will come from Coinbase moving outside of the US.

Needham's Todaro added that the market should be on the lookout for a possible delisting of COIN or the termination of certain lines of business, but this is more of an unexpected scenario.

Since the beginning of the year, COIN has outperformed the S&P 500 as stocks have risen 65% compared to the underlying index's 11%.

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