Citigroup lowers Coinbase target price to $65, regulatory uncertainty weighs heavily

Wall Street giant Citigroup issued a report this week downgrading the stock rating of the cryptocurrency exchange Coinbase from buy to neutral, with the target price lowered from the original $80 to $65.

Citi: Regulatory Uncertainty Dragging Down Coinbase

According to a report by CoinDesk, Citigroup pointed out that until more comprehensive cryptocurrency regulations are established in the United States, Coinbase will continue to be affected by this uncertainty, dragging down its performance. Analysts stated in the report:

The idea of Coinbase re-registering outside the United States, the company's public responses, its formal lawsuit with the SEC, as well as the previously received Wells Notice have not yet shown effects, and issues such as Signature Bank's failure and its cryptocurrency-related matters will all be material for the SEC.

However, Citigroup also mentioned that Coinbase remains a leader in this field and if it can integrate more with traditional finance, it will become one of the better-positioned platforms, emphasizing:

Coinbase's current mission is to support the damaged reputation of the industry and pave a sustainable path for regulatory compliance.

Coinbase: A Longstanding Compliant Exchange in the U.S.

Coinbase is one of the oldest exchanges in the United States, founded in 2012, and went public on the Nasdaq exchange in April 2021, becoming the first publicly listed cryptocurrency company in the United States. Its stock price reached as high as $380 at the time of listing, earning a staggering $4 billion in 2021, but incurred a loss of $371 million during the crypto winter of 2022, both figures are adjusted EBITA, and the stock is currently at $48. Coinbase will release its Q1 2023 financial report after the U.S. market closes on 5/4.

For more news related to Coinbase, please see:

Coinbase Fights Back Against SEC Wells Notice, Coinbase General Counsel Criticizes: Enforcing Without Regulatory Rules

U.S.-based Crypto Firms Coinbase and Gemini Launch Offshore Derivatives Exchanges

Coinbase Enlists Former Labor Secretary for Support, Officially Sues SEC, Demanding Specific Regulatory Rules