The Court’s Ruling on Ripple’s XRP Token
The recent U.S. district court ruling on Ripple’s XRP token has implications for Coinbase shares and the broader crypto market, according to a report by broker Needham. The court ruled that XRP should not be considered a security if sold through an exchange or programmatic sales. Here are the key points:
- The ruling sets a precedent that token sales through exchanges, like XRP, do not violate securities laws.
- This decision should reduce the regulatory pressure on Coinbase shares, which has been weighing on the stock price.
- Needham maintains its buy rating on Coinbase shares and raises its price target to $120 from $70.
- The recent bitcoin ETF applications using Coinbase further support the ecosystem and Coinbase.
- While Needham has raised its earnings estimates for Coinbase, it warns of poor volumes if retail trading continues to decline.
Needham’s Positive Outlook
Needham’s report is optimistic about the impact of the court’s ruling on Coinbase shares and the broader market. It believes that the ruling de-risks the regulatory pressure on Coinbase, which has been a significant concern for investors. The broker maintains its buy rating on the stock and raises its price target. However, German investment bank Berenberg disagrees, stating that the rally in Coinbase shares is unwarranted. Only time will tell how this court ruling will truly impact the crypto market.
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