Coinbase downgraded to Neutral at Citi amid uncertain regulatory backdrop

Coinbase Global ( NASDAQ: COIN ) stock slipped 1.7% in Monday after-hours trading after Citi downgraded shares of the cryptocurrency exchange to Neutral from Buy, citing an uncertain regulatory backdrop. "Until the regulatory 'rules of the road' are better established in the U.S., the stock will remain weighed down by this high level of uncertainty," analyst Peter Christiansen wrote in a note. Shares dropped nearly 25% from a month ago in the wake of its legal battle against the U.S. Securities and Exchange Commission. In late March, the regulator sent a warning to COIN that SEC staff recommended enforcement action against the company for allegedly breaching securities laws. COIN is still up 58.7% YTD, though, amid a broader crypto rally. The company last week filed an action in federal court seeking to compel the SEC to respond with a "yes" or "no" to its July 2022 petition asking the regulator to use its formal rulemaking process to provide guidance for the crypto industry. "Coinbase is now tasked to advocate for a reputationallydamaged industry and pave a sustainable pathway towards regulatorycompliance," the note said. Christiansen's Neutral rate aligns with the Quant system rating and the average Wall Street analyst rating, both at Hold. More on Coinbase Global Coinbase Stock Is Up 80% This Year: Why It's Time To Be Cautious Coinbase: Invest If You Believe In Crypto