COINBASE GETS SUED BY THE SECÂ đ„
Gary Gensler and the #SEC army have been working overtime.
First it was Kraken. Yesterday there was a bombshell lawsuit against #Binance. And today they are targeting Coinbase⊠again.
![](https://public.bnbstatic.com/image/pgc/202306/0034fb803eb0974877b08c6a3a092fe2.jpg)
Itâs a 101-page lawsuit, but say it with me ânever let a Roader read more than 1 pageâ. So, we did all the reading for you.
Hereâs what the SEC is saying:
Coinbase has been operating a non-registered securities exchange. Even though they arenât willing to provide guidance on complying with regulationâŠ
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. 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 didnât register the offer and sale of their staking program. After targeting Krakenâs staking service, it only makes sense that Coinbase would be next in line.
The crazy part? 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 âsecuritiesâ were already tradeable.
And the U.S. government is no stranger to the platform. Theyâve been using Coinbase to sell confiscated Bitcoin and will continue to throughout the year.
As if things couldnât get worse, 10 state security regulators have formed a task force to support the SECâs 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.
Hereâs how the markets reacted:
Coinbaseâs stock opened the trading day down ~20%, but slightly recovered to close down 12%
#$BTC Â dipped slightly on the news release but bounced back to rally over 5% in the following hours
#$ETH Â followed in Bitcoinâs footsteps, jumping ~4% in the hours after
Here are some of the responses from #Twitter:
![](https://public.bnbstatic.com/image/pgc/202306/e43ca3ae8a264a135252a5e5b77fba00.jpg)
![](https://public.bnbstatic.com/image/pgc/202306/cbf86e45fb455d4c448bd4eda524cb1f.jpg)
![](https://public.bnbstatic.com/image/pgc/202306/249b53773e57c4afd468f90e426e6fc5.jpg)
![](https://public.bnbstatic.com/image/pgc/202306/1adc81f1692cdd6038f665f3425c0b58.jpg)
![](https://public.bnbstatic.com/image/pgc/202306/6c7319ada0a7d74e9206eaf1f6c54fcc.jpg)
that's it for today, let me know your thoughts in the comment section
thanks for reading.