A crypto winter may be in progress, and that’s hitting exchanges hard as well. But for the Coinbase (NASDAQ:COIN) exchange, things are looking up. The stock is up substantially in Wednesday afternoon trading thanks to potentially recovering crypto prices and a hefty settlement with New York state regulators.
Coinbase agreed to settle with the New York Department of Financial Services for $100 million over issues with Know Your Customer (KYC) regulations. The fines came in two parts: first was the actual fine, which came in at $50 million. The second $50 million, meanwhile, is payable over the next two years. That $50 million will strengthen Coinbase’s compliance operations.
Regulators noted that Coinbase’s failings may have exposed the platform to a range of issues, starting with money laundering and even narcotics trafficking. This wasn’t the first time such issues emerged, either; Coinbase faced issues with its anti-money laundering (AML) compliance mechanisms as well back in 2018.
Settling the fines, and getting that trouble out of Coinbase’s path, gave Coinbase shares an extra push today. Nevertheless, perhaps as important was a sign that bitcoin (BTC-USD)—and the rest of its crypto cousins—may be making a comeback. Just yesterday, bitcoin eyed high prices for the week, with a new leg up to $17,300 a coin possible. Predictions for 2023 already range from a 70% plunge to a 1,400% rally, and that may draw a lot more interest to Coinbase’s platform and stock.
Wall Street has faith in Coinbase stock’s ability to proceed as well. Analyst consensus calls Coinbase stock a Moderate Buy. With a $71.06 average price target per share, the stock also boasts 88.24% upside potential.