Coinbase Earn Is Particularly Vulnerable to Being Defined as a Security: Berenberg
The crypto exchange is still faced with significant regulatory challenges, the report said.
Investors were reminded of Coinbase’s (COIN) significant regulatory challenges after Friday’s market close, when the crypto exchange disclosed it had in four of the 10 states that , investment bank Berenberg said in a research report Monday.
While the U.S. District Court ruled that in and of itself last week, it also ruled that XRP can be classified a security when used in certain transactions, the report said.
“, the securitized product through which COIN offers staking rewards to retail customers, appears particularly vulnerable to being defined as a security within this context,” analysts led by Mark Palmer wrote.
Berenberg notes that staking was one of the topics of discussion last Thursday during the first pre-motion hearing in the U.S. Securities and Exchange Commission’s (SEC) .
“The commission’s arguments could gain support if any or all of the 10 states that initiated proceedings against COIN for operating an illegal staking program affirm that the program facilitates securities offerings,” the report added.
The German investment bank has a hold rating on Coinbase shares with a $39 price target. The stock closed at $105.55 on Monday.
Edited by Sheldon Reback.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
6 Reasons XRP Price Could Hit $1 This Summer (Opinion)
Many are wondering if XRP can reach $1 anytime soon. Well, here are a few reasons in support.
