Coinbase execs respond to SEC's Wells notice in person and on video
Executives of cryptocurrency exchange Coinbase took their company’s regulatory issues to the public on April 27, with chief legal officer Paul Grewal speaking at Consensus 2023 and appearing with CEO Brian Armstrong in a video released on YouTube.
The appeal was in response to a Wells notice received by the firm, a notification by the United States Securities and Exchange Commission (SEC) that it may intend to carry out enforcement actions against it.
“Coinbase’s core commitment to regulatory compliance has never wavered,” Grewal said in the video, which was addressed to the chair and commissioners of the SEC.
At approximately the same time as the video appeared, Grewal was talking to an audience in Austin at Consensus 2023, where he said:
In the video, Grewal argued that Coinbase’s business has not changed in the two years since it was approved for listing on the Nasdaq stock exchange. At that time, Grewal said “the SEC’s position appeared to be that the SEC lacked statutory authority to regulate businesses like Coinbase.”
Grewal attributed the SEC’s new view to FTX. He quoted SEC chair Gary Gensler as saying “I feel that we have enough authority, I really do, in this space.” FTX was “entirely dissimilar” to Coinbase, Grewal added.
Coinbase is already regulated, Grewal said, and mentioned it has a New York state "BitLicense" that prohibits it from listing securities.
“We believe that legislation or rulemaking is needed if the SEC wants to expand its oversight over our industry,” Grewal said. The SEC asked Coinbase last summer to develop a proposal for crypto companies to register if they want to list securities.
The SEC discontinued that discussion before responding to Coinbase’s proposals and a few weeks before the issuance
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