Cathie Wood, the CEO and founder of ARK Investment Management, expressed her bullish stance on Coinbase following Ripple’s partial victory in its legal battle with the Securities and Exchange Commission (SEC) on July 13.
Although Wood acknowledged that the ruling did not entirely favor Ripple, she emphasized that it was generally positive for crypto exchanges. She joined other industry pundits in suggesting that the decision, which determined that XRP tokens sold to retail investors on crypto exchanges were not securities, could set a favorable precedent for Coinbase and Binance in their ongoing legal disputes with the regulator.
Wood pointed out that despite Coinbase receiving a Wells notice in March and facing a lawsuit from the SEC in June, the company’s share price did not plummet to new lows, indicating resilience in the value of Coinbase stock.
On July 17, three of ARK Investment’s exchange-traded funds (ETFs) sold a total of 248,838 shares of Coinbase, valued at $26.3 million at the time. This followed another sale of $12 million worth of Coinbase stock by the ARK Innovation ETF on July 11. Coinbase’s shares have experienced significant growth since the beginning of 2023, starting at $33.60 and surging over 184% to reach $105.55 at the time of publication.
While many industry participants are becoming increasingly optimistic about Coinbase, analysts from Berenberg Capital Markets cautioned that various regulatory aspects for crypto exchanges are yet to be resolved. In an investment note dated July 17, lead analyst Mark Palmer highlighted that Coinbase Earn, a product offering yield on crypto staking, could be particularly vulnerable to being classified as a security based on the comments made by Judge Analisa Torres in her ruling on the Ripple case.
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