Brian Armstrong is the chief executive of Coinbase, the largest U.S. cryptocurrency exchange. (Jason Armond / Los Angeles Times)

Coinbase on Monday became the first cryptocurrency exchange to join the Standard & Poor's 500 index, marking a pivotal moment for the digital assets industry.

The inclusion on the S&P 500 also was a point of pride for Coinbase, which consumers use to buy, sell, transfer and store various cryptocurrencies, such as Bitcoin.

The S&P 500 tracks the stock performance of 500 leading publicly traded companies in the United States.

"This milestone represents what the true believers, from retail investors to institutional investors to our employees and partners, knew all along. Crypto is here to stay," said Coinbase Chief Executive Brian Armstrong in a post on the social media platform X.

Coinbase first made its public debut in 2021, when it listed its shares on the Nasdaq. Initially based in San Francisco, Coinbase became a remote-first company and isn't headquartered in one city.

The move comes as the Trump administration bolsters an industry that backed the Republican president's return to the White House.

While cryptocurrency companies expect to face a more friendly regulatory environment under Trump, who also launched his own meme coin, they're still encountering familiar hurdles over data security and privacy that are putting a damper on their shining moment.

Read more:Cryptocurrency industry is spending more than any other to sway California congressional races

Last week, Coinbase revealed it was hit with a cyberattack that could cost it $180 million to $400 million, according to a filing last week with the U.S. Securities and Exchange Commission.

The company said that cybercriminals bribed customer support agents overseas to steal data from its customers so they could trick Coinbase users into handing over their crypto.

The criminals obtained information such as names, phone numbers, emails, the last four digits of people's Social Security numbers and other valuable data for less than 1% of its users.

Coinbase has refused to pay a $20-million ransom demand by hackers. Instead, it is offering a reward for that amount to anyone who provides information that leads to the arrest and conviction of those responsible.

The cyberattack isn't the only problem Coinbase is still tackling. The New York Times first reported that the SEC is also investigating Coinbase, which says it has more than 100 million verified users, over whether the company misstated that figure.

And Coinbase is facing a lawsuit in Illinois over whether it illegally collected, stored and kept biometric data, such as the face scans users provided for identity verification.

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Coinbase Chief Legal Officer Paul Grewal said in a statement that the SEC's inquiry was a "holdover" from the Biden administration and involved a metric the company no longer uses.

"While we strongly believe this investigation should not continue, we remain committed to working with the SEC to bring this matter to a close," Grewal said.

Wall Street has not been rattled by the controversy around the company.

Coinbase's stock surged 24% when it announced last week that it would join the S&P 500. On Monday, the company's shares closed $263.99 per share, virtually unchanged.

Mark Palmer, an tech industry analyst for Benchmark Equity Research, said in a note that while the data breach is concerning, it appears to be an "one-off event rather than a symptom of more pervasive security issues."

The firm views the SEC investigation "as little more than noise that is highly unlikely to have any material impact on any of the drivers of the bullish thesis on the company’s stock," Palmer wrote in the note.

Coinbase's first quarter revenue reached $2.03 billion, up 24% year-over-year, but slightly missed analyst's expectations. The company's net income was $66 million down, from $1.8 billion during the same period last year.

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This story originally appeared in Los Angeles Times.

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