The value of Bitcoin, the resolution of the SEC action, and the general state of the cryptocurrency market are all important variables that affect Coinbase’s stock price, according to Oppenheimer analyst Owen Lau.
The company’s continuing legal battle with the US securities commission and the expected drop in Bitcoin prices could cause short-term volatility in Coinbase’s stock price. as per an analyst at Oppenheimer, an investment bank.
The ongoing legal uncertainty surrounding Coinbase’s lawsuit with the U.S. Securities and Exchange Commission (SEC) alleging it violated security laws may result in price fluctuations for the company’s stock, which is currently trading at $125, according to Oppenheimer analyst Owen Lau, who made this assessment in a recent interview with Yahoo Finance.
“We still don’t have clear regulations in the United States right now; there is still a regulatory overhang.”
Elliot Stein, a Bloomberg litigation expert, recently expressed confidence about Coinbase’s chances of winning its case against the U.S. regulator, estimating that there is a 70% chance the exchange will emerge from the legal process undamaged.
Lau predicted that Coinbase’s stock price would fluctuate, as it had just dropped by about 28% during the previous 30 days. It has, nevertheless, gained almost 67% total over the last three months.
Lau ascribes the entire rise to the growing confidence surrounding the U.S. SEC’s approval of a spot Bitcoin ETF on January 10, which caused the price of Bitcoin to soar towards the end of 2023. But since the SEC approved spot Bitcoin exchange-traded funds two weeks ago, the price of Bitcoin has fallen by about 10.37%. As of this writing, the price of Bitcoin is $41,863. Lau also predicts that the price of Bitcoin will see brief oscillations.
“Until the next catalyst, I do believe that there will be some downward momentum on Bitcoin in the near term,” he said. JPMorgan reportedly lowered Coinbase’s stock to a “underweight rating” on January 23 as well, citing the declining price of Bitcoin and listing shares of spot bitcoin Etfs