Coinbase Wells notice fight will take ‘years to resolve,’ says Compass Point

After Coinbase Global disclosed that it received a Wells notice from the SEC regarding "an unspecified portion" of its spot market, Coinbase Earn staking service, Coinbase Prime institutional investor platform, and Coinbase Wallet, Compass Point analyst Chase White said the firm expects investors to view this as "a materially negative risk" and that it expects Coinbase to fight any enforcement action in court, which will likely take several years including any appeals. In the end, the firm does not expect any SEC enforcement action to present "an existential threat to Coinbase," and it ultimately expects Coinbase to prevail in court, preserving the vast majority, if not all, of its business, with the worst case scenario likely being a multi-hundred million dollar fine. The firm, which acknowledges the "headline risk" from the ongoing fight, keeps a Buy rating and $100 price target on Coinbase shares.