By Shares of Coinbase Global Inc. experienced a significant rally on Thursday after a federal judge determined that Ripple Labs’ token was not classified as a security when sold to the general public on cryptocurrency exchanges.
Ripple Token Not Deemed a Security in Retail Sales
The judge’s ruling is seen as favorable for Coinbase (COIN) as the company faces a lawsuit from the Securities and Exchange Commission (SEC) accusing them of operating an unregistered national securities exchange and engaging in illegal sales of tokens considered securities by the SEC.
While the judge recognized that Ripple XRP sales to institutional investors were unregistered, the favorable ruling regarding retail sales could potentially benefit Coinbase in its ongoing regulatory battles.
Coinbase Defies Downgrade, Soaring 18%
Despite a downgrade from a Barclays analyst, who expressed concerns about the current state of the crypto markets and lingering regulatory pressures, Coinbase’s shares surged by nearly 18% in afternoon trading. Earlier in the session, the shares had been down by as much as 2.9%.
Crypto Stocks Experience Significant Boost
In addition to Coinbase’s impressive performance, other cryptocurrency-related stocks also witnessed substantial gains on Thursday. Bitcoin-mining companies Marathon Digital Holdings Inc. (MARA) and Riot Platforms Inc. (RIOT) saw their shares rise by over 13% each. MicroStrategy Inc. (MSTR), a software company with sizeable bitcoin holdings, experienced an approximately 8% increase in its share value. Furthermore, Robinhood Markets Inc. (HOOD), which offers crypto trading on its platform, saw its shares rise by more than 5%.
Expert Opinion: BlackRock’s Bitcoin ETF Filing Supports Coinbase
An analyst suggests that BlackRock’s recent filing for a bitcoin exchange-traded fund (ETF) is a vote of confidence in Coinbase. This development serves as further validation for the company amid its ongoing regulatory challenges.
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