SEC investigates Coinbase
Major US crypto asset (virtual currency) exchange Coinbase announced on the 22nd that it received a “Wells Notice” from the US Securities and Exchange Commission (SEC) on the same day.
The SEC’s investigation includes listed cryptocurrencies and the staking service Coinbase Earn. Coinbase said it believes its products and services are legal and welcomes lawsuits.
What is staking
A system or service that rewards you by depositing a certain amount of virtual currency for a specified period of time. Rewards can be received as compensation for contributing to the operation of the blockchain.
connection: US SEC investigates coinbase offering unregistered securities = report
A Wells notice is a formal letter to a company or individual informing them that the SEC will take legal action. The SEC has recently accelerated regulatory action on cryptocurrency brands and services.
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Below is a list of all the items covered in this survey.
- Some of the listed digital assets (issues unspecified)
- Coinbase Earn
- Coinbase Prime (solution for institutional investors)
- Coinbase Wallet
Coinbase said the Wells notice did not provide much information on how the company should respond. The Wells notice does not imply a lawsuit, but it is reported that Coinbase may be violating securities laws.
Coinbase, meanwhile, claims the SEC did not respond to questions about which listed stocks are securities. He also said he had made several proposals over the months to register his business with the SEC, but the SEC refused to act.
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No lawsuits have been filed at this time, so Coinbase will continue to operate its services as normal. On the other hand, the US Federal Open Market Committee (FOMC) and this report overlapped, and Coinbase’s stock price fell 8.1% from the previous day, and dropped another 12% in after-hours trading.
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Virtual currency listings are rigorously screened
As the stock trades, Coinbase will go public on the Nasdaq on April 14, 2021. In this announcement, it is pointed out that Coinbase has not fundamentally changed since this time. He argued that the stock listing should have happened after a lengthy review by the SEC itself.
Coinbase once again asserts that it does not have securities listed and does not offer products equivalent to securities. Each issue is rigorously screened before it is listed on the exchange, and whether or not it falls under the category of securities is also included in the examination items.
He also explained that 90% of the stocks that were screened had not been listed so far because they did not meet the conditions. It points out that this review process was shared with the SEC when the stock was listed.
In addition, they insist that they will comply with the regulatory rules if they show them, and that they will register if they show the actual procedures. If necessary, he said he would take legal action to clarify regulations and prove the SEC’s unfairness and inadequacy in court.
connection: US SEC Chairman “We are neutral to technology such as staking”