Coinbase is reeling from recent regulatory action as investors are fleeing from its shares. This has resulted in company stock slumping 28.6% over the past three weeks.

On April 11, COIN was trading at a little over $70, however, it had slid to $51 in after-hours trading on May 2 following a 3% fall since the beginning of this week.

The stock is currently down almost 40% from its 2023 high of $84 on March 21 as America’s war on crypto intensifies. By comparison, crypto markets have retreated just 8.5% from their 2023 high.

Coinbase shares are now trading down 85% from their all-time high of $343 in November 2021, the same month as the crypto bull market peak.

Coinbase Downgraded

Earlier this week, Citi Group downgraded shares of the crypto exchange from Buy to Neutral, citing an uncertain regulatory backdrop. Analyst Peter Christiansen wrote:

“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.”

Coinbase stock started to suffer after the Security and Exchange Commission issued a Wells notice in late March.

Last week, company executives hit back at the securities regulator, stating that the threat of legal action when there is not a clear rule book is not constructive. “We are prepared to defend that position in court, but it doesn’t have to come to that,” added CEO Brian Armstrong.

It also filed an action in federal court last week seeking to compel the SEC to respond to its July 2022 petition asking for regulatory clarity on crypto. The federal regulator has ignored the petition and the request but has continued with its crypto enforcement crackdown.

Coinbase was in hot water again this week when executives were accused of dumping millions in stock to avert losses using insider trading. The latest crypto lawsuit in the land of litigation alleged that the firm’s management offloaded their stock before an earnings report prompted a decline in share prices.

Bank Stocks Plunge

Coinbase isn’t the only company to see shares slide. The American banking crisis appears to be deepening as several banks saw losses in stock values this week.

PacWest, Western Alliance, and several other financial institutions slid over 20% on the day on May 2 following the seizure of First Republic Bank by U.S. financial regulators.