Analysts Call Market Reaction to Coinbase Hack ‘Overblown’ Amid SEC Probe
Coinbase (COIN) shares fell 7.2% following a data breach and an SEC investigation announcement, with intraday losses nearing 9%. Analysts from Barclays and Oppenheimer suggest this sell-off may be an overreaction.
- The data breach involved bribed customer support agents leaking user data but did not compromise passwords, private keys, or funds.
- Less than 1% of users were affected; Coinbase refused to pay a $20 million ransom.
- Estimated costs to address the breach range between $180 million and $400 million.
- The SEC probe questions the accuracy of user numbers reported in Coinbase's 2021 IPO filing.
- Barclays and Oppenheimer view the breach as isolated and not indicative of systemic risk.
- Mark Palmer from Benchmark raised his price target for Coinbase to $301, citing potential benefits from institutional adoption and regulatory clarity.
Investors may be reacting to recent stock gains, leading to volatility. Analysts maintain a positive outlook despite current challenges.