Cryptocurrency exchange Coinbase experiences growth following S&P 500 listing, yet potential cyber intrusion thwarts shares advancement.
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Coinbase experienced a significant stock surge on Tuesday, soaring to its highest price since Donald Trump's presidency, following the announcement that the crypto exchange would be joining the S&P 500. Coinbase will replace Discover Financial Services, propelling it into the coveted market-capitalization-weighted US index tracing the nation's 500 leading public companies.
Coinbase shares skyrocketed 24% after the announcement, coming just short of the 31% boost it experienced after Trump's election in 2016. However, the cryptocurrency exchange took a hit on Thursday, with shares plummeting more than 5% after a cyber-attack. The attack compromised account data for a small number of customers, potentially causing a $180-$400 million loss for the company.
As of writing, Coinbase shares are trading at $251.57, reflecting a 43% increase over the past month. Brian Armstrong, Coinbase's CEO, celebrated the S&P 500 inclusion, stating, "Coinbase joining the S&P 500 means crypto's here to stay." The company is now setting its sights to become the world's largest financial service app.
Nick Jones, CEO of digital assets firm Zumo, noted the significance of this milestone for the mainstream adoption of digital assets. He emphasized the UK's need to keep pace with evolving crypto regulations, as UK regulators, such as HM Treasury and the Financial Conduct Authority, work to create a regulatory framework for crypto assets. According to Jones, the UK has yet to see the level of crypto growth, positive announcements, and product movement experienced in countries like the US and even the EU.
Meanwhile, bitcoin shot past $100,000 last week, only to be thwarted by the $105,000 barrier. On Thursday, bitcoin was trading at $102,345.80. The digital currency peaked at $104,167.60 on Tuesday.
Crypto analyst Simon Peters pointed out that the surge in the bitcoin price coincided with news of the UK-US trade deal. While the UK is not a major trading partner, Peters asserted that this initial deal signaled the start of more to come.
Following the S&P 500 news, Coinbase is not without challenges. The company revealed that names, addresses, and emails were stolen during the cyber-attack. However, login details remain secure, and the firm has pledged to reimburse customers who were deceived into transferring money to the attackers. As the crypto sector grows, robust cybersecurity measures become increasingly crucial, as embodied by this recent incident.
- The inclusion of Coinbase in the S&P 500 signifies a significant step in the integration of cryptocurrency into mainstream finance and business, as stated by Brian Armstrong, the CEO of Coinbase.
- The surge in Coinbase's stock price, following its announcement to join the S&P 500, indicates a growing acceptance of cryptocurrency and technology as viable components of the world's largest financial service apps.
- Nick Jones, CEO of digital assets firm Zumo, highlighted the importance of the UK adapting its crypto regulations to keep pace with technological advancements in the finance sector, particularly in countries like the US and EU, to promote the growth of digital assets and their mainstream adoption.
