Recent reports of Hamas utilizing cryptocurrency for funding attacks in Israel could pose challenges for Coinbase’s lobbying endeavors in the United States, according to analysts at Berenberg Capital Markets. The lead analyst, Mark Palmer, expressed a “cautious stance” towards Coinbase, citing regulatory actions and political complications arising from the Israel-Hamas conflict.
The investment report, released on October 18, highlights the impact of the Israeli authorities’ actions against crypto accounts associated with Hamas on platforms like Binance. These accounts were reportedly aiding the militant group in fundraising efforts, leading to the seizure of millions of dollars worth of cryptocurrency.
Palmer notes that despite Hamas declaring in April that it would cease using crypto for fundraising due to traceability concerns, recent headlines may further complicate the legal status of cryptocurrency. Coinbase, in its efforts to advocate for clear and crypto-friendly regulations in the U.S., may face increased scrutiny due to these developments.
Coinbase’s intensified lobbying in recent years is part of its strategy to encourage more transparent and favorable crypto regulations in the country. Berenberg analysts maintained a “hold” recommendation on Coinbase (COIN) stock with a price target of $39. However, Palmer expressed caution, stating, “Our Hold rating on COIN reflects our view that the stock is uninvestable in the near term,” emphasizing concerns about the evolving regulatory landscape.
At the time of publication, Coinbase shares were trading at $77.30, up 3% for the day. Palmer underscored the need for a careful approach, especially given Coinbase’s significant year-to-date stock increase compared to Bitcoin and the Nasdaq.
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