Coinbase could be on the brink of the SEC hammer- but why
The Securities and Exchange Commission (SEC) is set on a mission, and the next target of this mission turns out to be the leading cryptocurrency exchange, Coinbase.
Just last week, the SEC filed a lawsuit against the organization’s former product manager, his brother, and his friend on account of insider trading.
Before then, the company had laid off over 20% of its staff—citing overhiring. However, it seems that it’s the season of recurring problems for the Brian Armstrong-led firm.
According to reports from Bloomberg, the SEC is looking into Coinbase for allegedly listing securities on its exchange.
Based on the report, the SEC was investigating Coinbase for allowing U.S. residents to trade assets that should have been registered as securities on its platform.
Interestingly, the accusation could be a follow-up on the insider trading case of the former employee. The SEC claimed that it found nine tokens that should have been registered as securities during its investigation. For this reason, the Coinbase company at large could be indicted.
In 2021, SEC chair Gary Gensler called for Coinbase to register as a securities exchange. However, Coinbase CEO Brian Armstrong declined. He stated that listing every token legally had its downsides and could affect the crypto ecosystem.
The company’s chief policy officer, Faryar Shirzad, supported his statement as he accused the SEC of a shady regulatory procedure.
So, what has Coinbase said about this new allegation?
At the time of writing, Coinbase had not publicly responded to the probe. However, it seemed that the company expected the issue to create a brawl as it had released two separate statements— one on listing securities and the other on feasible crypto regulations.
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