Coinbase CEO Brian Armstrong is scheduled to have a closed-door meeting on Wednesday morning with Democratic members of the House of Representatives in Congress, according to reports. The meeting, which will be private, involves Congress members from the New Democrat Coalition, a group of over 100 Democrats who prioritize pro-economic growth, pro-innovation, and fiscally responsible policies. It comes at a time when this exchange is engaged in a legal dispute with the U.S. Securities and Exchange Commission (SEC). The discussions during the meeting will focus on various aspects of digital-asset legislation, including tax, national security, privacy, and climate-related concerns. Recent attempts to introduce separate bills in the House and Senate to bring clarity to crypto regulation may face challenges due to the divided nature of Congress, raising uncertainty about the outcome of such legislative efforts.
Coinbase was charged by the SEC on June 6 for violating federal securities law. In response, they argued that the SEC’s actions infringed upon due process and were an abuse of discretion. Following a court ruling that deemed Ripple’s XRP token as not a security, Coinbase shares experienced a significant increase of over 24% on Thursday. As of early Tuesday morning before U.S. office hours, both Coinbase and the New Democratic Coalition had not yet provided a comment in response to a request for one.
Barclays Concurs: XRP Ruling Benefits Coinbase
According to Barclays, Wall Street banks, including J.P. Morgan, share the perspective that the recent ruling in favor of Ripple by the U.S. Southern District Court has positive implications for Coinbase, the crypto exchange. In their research report on Monday, Barclays described the ruling as “incrementally positive” for Coinbase, as it suggests that certain tokens may not be considered securities. The bank’s analysts maintained their underweight rating for this exchange platform stock, setting a price target of $70. They also noted that this ruling could bring additional clarity for future token issuances.
On July 13, Barclays downgraded Coinbase’s rating from equal weight to underweight, citing a lack of positive drivers for the company’s share price in the near future. The Securities and Exchange Commission (SEC) recently filed a lawsuit against this platform, alleging violations of federal securities law, similar to a suit filed against Binance.
Barclays’ positive assessment of Coinbase aligns with the views expressed by other Wall Street firms, including J.P. Morgan and Needham. J.P. Morgan, which has a neutral rating on COIN, stated in a note on Friday that Coinbase is well-positioned to benefit from improved confidence and regulatory clarity due to its leading market position and respected reputation in the industry.
Similarly, Needham analyst John Todaro, who has a buy rating on Coinbase with a price target of $120, emphasized that the recent outcome moderately reduces regulatory pressure on Coinbase’s stock. The decision made by a U.S. judge on Thursday determined that Ripple’s XRP token should not be categorized as a security when sold on an exchange or through programmatic sales. Following the public announcement of this ruling on July 13, Coinbase shares have seen an increase of nearly 30%.
Contrary to the positive outlook of some analysts on Coinbase’s stock following the XRP ruling, not all analysts shared the same sentiment. Investment bank Berenberg expressed a different view last week, suggesting that the surge in the crypto exchange’s shares may have been excessive, potentially due to a partial misinterpretation of the ruling by certain investors.