Coinbase Shares Drop By 9% On Monday Following SEC’s Suit Against Binance

TL;DR

• The shares of Coinbase dipped by more than 9% on Monday after the SEC sued Binance.

• The SEC issued a Wells Notice to Coinbase earlier this year, indicating that it is looking into the activities of the crypto exchange.

Coinbase Shares Dip On Binance News

Shares of Coinbase (COIN) tanked by 9.05% on Monday following the news that the US SEC sued Binance for violating federal securities law on Monday.

Binance remains the world’s largest cryptocurrency exchange in terms of daily trading volume, with Coinbase a distant second. 

The SEC coming after Binance for breaking securities law could be an indication of what is to come for Coinbase. 

While commenting on this latest development, Edward Moya, senior market analyst at foreign exchange Oanda, said;

“Coinbase shares are down sharply as it looks like U.S. regulation will deem many cryptos as securities. Coinbase wants regulatory clarity, and it seems the SEC is going to cripple large parts of the cryptoverse.”

At press time, COIN is trading at $58.70, down by more than 9%. Coinbase’s stock has been performing well since the start of the year. Following its poor performance last year, COIN is up by more than 70% year-to-date, thanks to the rally embarked by Bitcoin and the other major cryptocurrencies over the last five months. 

Coinbase is not the only crypto-related company that saw its stock price take a hit. The shares of MicroStrategy (MSTR), which holds a vast amount of bitcoin on its balance sheet, also dropped by more than 8% on Monday. 

The SEC issued a Wells Notice to Coinbase earlier this year, indicating that it is looking into the activities of the crypto exchange. 

Binance has come under scrutiny from regulators in recent years. The crypto exchange exited the Canadian market last month due to the recent regulatory changes.