Coinbase stock bounces after $100 million settlement deal with New York financial services regulator

Shares of Coinbase Global Inc.
COIN,
+11.85%
bounced 4.1% in morning trading Wednesday, after it was announced that the cryptocurrency exchange agreed to a $100 million settlement with New York regulators regarding allegations that it failed to properly vet new customers. The stock had started 2023 with a 5.1% drop on Tuesday, after plunging 86.0% in 2022, compared with a 19.4% decline in the S&P 500
SPX,
+0.55%
last year. The New York State Department of Financial Services said the settlement comes after “significant failings” in the company’s compliance program were found. Under terms of the settlement, Coinbase will pay a $50 million penalty and invest $50 million in its compliance program over the next two years. “Coinbase failed to build and maintain a functional compliance program that could keep pace with its growth,” said DFS Superintendent Adrienne Harris. “That failure exposed the Coinbase platform to potential criminal activity requiring the Department to take immediate action including the installation of an Independent Monitor.”