The Trump administration was supposed to bring with it a lot of things, including the end of the Internal Revenue Service, an end to Daylight Saving Time, and a much better regulatory environment for cryptocurrency. Many of these things have yet to arrive. Cryptocurrency exchange giant Coinbase (COIN) recently took a look at that regulatory environment, and word from the Securities and Exchange Commission (SEC) noted that new changes are moving, but struggling to get “…over the finish line.” That was good enough for investors, as evidenced by Coinbase shares surging up nearly 4% in Thursday morning’s trading.
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The hope is still to get this covered by the end of the year, though admittedly, the recent government shutdown might impact this timeline a bit. Faryar Shirzad, Coinbase’s chief policy officer, recently tackled the state of things in Washington. Shirzad revealed that about 20% of the United States owns at least one form of cryptocurrency, so there is a huge incentive for Congress to do something here, and do something in favor of crypto.
Congress is currently working on what Shirzad called “market structure legislation,” which is basically the standard rules and principles that govern a market. Also included is the SEC’s position in regulating the market. Without that structure, operations like Coinbase currently run on a pastiche of state and federal rules, and that could leave holes in the market where operations simply are not covered.
Universal Basic Cryptocurrency
Out in New York, meanwhile, a program is in the works to take another run at universal basic income (UBI), the program that calls for a certain amount of money to be doled out just to help with living expenses. Some consider it communism in the making, while others consider it a necessary concession to increasing automation and artificial intelligence (AI).
But the payments—about $12,000 over the next five months—are already hitting users’ Coinbase accounts, as users are paid out in the USDC stablecoin. The program will be administered by GiveDirectly, a major nonprofit that focuses on direct cash payments. The move was intended to help with bigger purchases like housing and education, and not surprisingly, they want to see how much of the payments go to just that.
Is Coinbase a Buy, Sell or Hold?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on COIN stock based on 14 Buys, 13 Holds and two Sells assigned in the past three months, as indicated by the graphic below. After a 112.24% rally in its share price over the past year, the average COIN price target of $378.17 per share implies 3.86% upside potential.
