Coinbase shares spiked 5% to $375 when markets opened on Thursday, putting the crypto exchange’s stock on track for its highest closing price on record.
Coinbase shares were recently changing hands around $372, well above the company’s record closing price of $357 in November 2021, according to Yahoo Finance. Year-to-date, the company’s stock price has climbed 50% from $256 in January.
Although Circle’s blockbuster IPO is contributing to Coinbase hype, alongside the Senate’s recent passage of stablecoin legislation, the CLARITY Act also represents a “significant catalyst” for the crypto exchange, Benchmark analyst Mark Palmer told Decrypt.
“If that were to be enacted, I think it would likely usher in a wave of institutional adoption that Coinbase is very well positioned to take advantage of,” he said, noting that a comprehensive regulatory framework would “impact almost every area of Coinbase’s business.”
On Thursday, Sen. Cynthia Lummis (R-WY) said that lawmakers are trying to produce a draft version of the bill before lawmakers break for August recess, aiming to “mark it up in September,” per Crypto In America’s Eleanor Terrett on X, formerly Twitter.
The legislation would establish jurisdiction over crypto between the U.S. Securities and Exchange Commission and Commodity Futures Trading Commission, while providing a pathway for tokens to become certified as commodities. Still, the bill could be derailed.
Earlier this week, Palmer raised his price target for Coinbase shares to $421 from $301, highlighting Coinbase’s European expansion and its ability to fold USDC into its services.
Under U.S. President Donald Trump, the San Francisco-based exchange has benefited from a “steady flow of positive regulatory news,” according to Gerry O’Shea, head of global market insights at crypto asset manager Hashdex.
“Short-term price volatility will remain an inherent feature of this asset class and these public companies, but the steady mainstream adoption of digital assets is only marching forward,” he said, pointing to the stablecoin bill and Federal Housing Finance Agency’s order on Wednesday.
The FHFA instructed Fannie Mae and Freddie Mac to begin preparing to accept cryptocurrency as a form of mortgage-related payment. And some analysts believe that the GENIUS Act, which would establish comprehensive rules for stablecoins, could become law as soon as August.
“These developments, and many others, are making it increasingly clear that digital assets will continue to be further intertwined with traditional financial markets,” O’Shea continued.
Coinbase derives the majority of its revenue from fees charged on customers trading activity, but it also earns a decent amount of cash from assets backing Circle’s USDC. Along those lines, investment firm Bernstein called the firm “misunderstood” in a note this week, predicting that the company’s shares will hit $510 by 2027.
Edited by James Rubin
