Coinbase May Experience Price Fluctuations Shortly, Says Analyst 

The volatility in the crypto market is going to influence the performance of Coinbase, according to Owen Lau, Oppenheimer analyst. In a recent interview with Yahoo Finance on January 24, Lau unveiled a few factors that can hamper Coinbase’s performance shortly. Ongoing lawsuits with the US Security regulators and Bitcoin price are emerging as the main reasons behind the same.   

Factors Influencing Coinbase’s Performance 

Coinbase stock currently streaming at $125 is supposed to experience price fluctuations in the near future. Owen Lau outlined this in an interview with Yahoo Finance. 

“There is still a regulatory overhang, we still don’t have clear regulations in the United States right now.”, said Lau. 

According to Lau, the increased volatility in the crypto industry will impact the near future performance of Coinbase, one of the leading cryptocurrency exchanges. The overall industry health, the decline in Bitcoin (BTC) price after spot BTC ETF approval, and the ongoing lawsuit with the SEC will affect the Coinbase stock price.    

Despite gaining a hike of around 67% in the past three months, Coinbase is anticipated to show a downward trend soon. A recent decline of over 28% in Coinbase’s stock price in the past 1 month sought the attention of Lau towards the cryptocurrency exchange. 

Everyone was expecting that by January 10, 2024, the crypto industry would reach new heights, mainly after the approval of spot Bitcoin ETF. However, a drop of 10.37% was observed in the BTC price in the past two weeks. 

According to CoinMarketcap, the current price of BTC is $41,515 with a market cap of $814 Billion.

Based on the BTC price and listing shares of Bitcoin ETF, Lau made the prediction. However, JPMorgan also devalued Coinbase’s stock to an “underweight rating”.  

What Analysts Are Saying

Despite the unhealthy performance of Coinbase, Elliot Stein, Bloomberg litigation analyst is hoping for a strong comeback of Coinbase. According to Stein, Coinase will receive full support from the SEC. 

“There are 70% chances that Coinbase will cure from the legal proceedings unharmed”, said Elliot Stein.

According to Stein, there are high chances of Coinbase securing victory in its ongoing lawsuit against the SEC. Coinbase providing with more precise definition of an “Investment contract”, made all the difference. 

Coinbase was accused of operating as an unregistered broker.  SEC sued Coinbase on June 6, 2023, for operating illegally in the US market. Coinbase is operating as an unregistered exchange, broker, and clearing agency.

According to the SEC, Coinbase has generated billions of dollars by buying and selling digital assets illegally. Additionally, Coinbase’s holding company, Coinbase Global Inc. is also liable for the law violation. The exchange is charged with violating the Securities Act of 1933. 

Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.