COINBASE GETS SUED BY THE SECĀ š„
Gary Gensler and the
#SEC armyĀ have been working overtime.
First it was Kraken. Yesterday there was a bombshell lawsuitĀ against
#Binance. And today they are targeting Coinbaseā¦ again.
source: cryptopm
Itās a 101-page lawsuit, but say it with me ānever let a Roader read more than 1 pageā. So, we did all the reading for you.
Hereās what the SEC is saying:
Coinbase has been operating a non-registered securities exchange.Ā Even though they arenāt willing to provideĀ guidanceĀ on complying with regulationā¦
They have been acting as an unregistered broker. A broker helps investors buy and sell securities. So if the SEC thinks Coinbase is listing securities, then they also think that Coinbase is helping users buy and sell securities.
Coinbase is an unregistered clearing agency.Ā Similar to brokers, clearing agents are involved in the process of exchanging securities. They make sure that deals happen on time and both parties stick to their end of the bargain.
They didnāt register the offer and sale of their staking program. After targetingĀ Krakenās staking service, it only makes sense that Coinbase would be next in line.
The crazy part?Ā The SEC also claims that Coinbase has been breaking the rules since 2019.
But the SEC is the same entity that approved Coinbase to go public in 2021 when many of these āsecuritiesā were already tradeable.
And the U.S. government is no stranger to the platform. Theyāve been using Coinbase to sell confiscated Bitcoin and will continue to throughout the year.
As if things couldnāt get worse, 10 state security regulators have formed a task force to support the SECās initiative.
These states issued a Show Cause Order saying that their local residents have been given staking rewards through an unregistered offering. Coinbase has 28 days to respond.
Hereās how the markets reacted:
Coinbaseās stockĀ opened the trading day down ~20%, but slightly recovered to close down 12%
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$BTC Ā dipped slightly on the news release but bounced back to rally over 5% in the following hours
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$ETH Ā followed in Bitcoinās footsteps, jumping ~4% in the hours after
Here are some of the responses from
#Twitter: that's it for today, let me know your thoughts in the comment section
thanks for reading.