Investors shouldn't chase the Coinbase rally that was sparked by a pop in crypto asset XRP due to a partial legal win in federal court, analysts warned. Coinbase shares are up 17% since a judge in the Southern District of New York ruled that XRP was not a security " on its face ." The judge also ruled that Ripple violated securities laws when selling XRP to institutions but not to retail investors.
mountain 2023-07-13 pops since July 13 "Despite positive elements of Ripple's surprise ruling and subsequent momentum for crypto stocks, we don't believe investors should be aggressive on recent momentum," Citi analyst Peter Christiansen said in a note Monday. He added that although the ruling is positive, it's "not a Panacea" for Coinbase. Meanwhile, Bank of America's Jason Kupferberg said the rally "looks overdone.
. With that said, the judge in the XRP case did not comment broadly on whether secondary market sales on exchanges constitute an investment contract," Kupferberg said in a Tuesday note. Plus, the SEC is likely to appeal the ruling and the securities regulator's lawsuit against Coinbase, which it brought in June. Both firms lifted their price targets on the shares, however. Citi raised its forecast to $105 from $65, but maintained its neutral rating.