Coinbase Warned by SEC of Alleged Securities Law Violations
Coinbase executives revealed today that the crypto exchange had received a “Wells Notice” from the Securities and Exchange Commission, indicating that after an investigation, agency staff planned to recommend some sort of regulatory action. execution. That could include charges or lawsuits, but none of that has happened yet.
According to Coinbase, the issue is “an indefinite portion of our listed digital assets, our Coinbase Earn staking service, Coinbase Prime, and Coinbase Wallet.” Coinbase Chief Legal Officer Paul Grewal shared a copy of the letter (PDF) the company received from the SEC, complain that “Over the past 9 months, CB has met with the SEC more than 30 times, sharing details of our business to build a path to registration. During this time, the SEC has given virtually no comment on what need to change or how to sign in. Instead we got a Wells notice today.
Coinbase had similar notes when it received a letter from Wells regarding the Lend program before trying to launch it in 2021, saying the SEC had not provided clear information on what security is or how how the company could register. Grewal and Coinbase CEO Brian Armstrong tweet threads About the letter, Coinbase is prepared to defend its position (that the products it offers should not be considered securities) in court, but so far no legal action or injunction. has been filed.
For now, the company’s blog post advises customers and investors that “Rest assured, Coinbase products and services continue to operate as usual – today’s news requires no changes to our current products or services”.