Coinbase shares ended Wednesday lower by nearly 2%, despite a more bullish start to the week that was kicked off with headlines the exchange is partnering with several asset managers on new spot bitcoin exchange-traded funds awaiting approval from the U.S. Securities and Exchange Commission.
The stock was trading down 1.98% to $78.35 per share at close, dragged down by a new downgrade from analysts at Piper Sandler. It has appreciated 133% since the beginning of the year.
The exchange, which has pared losses since the SEC announced a lawsuit against the firm, still faces "too much uncertainty to prudently project revenues in future years," according to analyst Patrick Moley. Piper Sandler previously had an overweight position for the stock.
Bloomberg News reported the downgrade earlier in the day.
Coinbase faces lawsuit from SEC
The SEC alleged in June that Coinbase trades unregistered securities and operates a business that merges functions "that are typically separated in traditional securities markets."
Still, a wide-range of issuers, including asset management giant Fidelity, have identified Coinbase as a partner in their plans to launch a spot bitcoin ETF. BlackRock, which filed its spot bitcoin ETF on June 15, has picked the exchange as its custodian.
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