The Coinbase Staking Service is No Longer Available in Four US States
The Coinbase staking service has been halted in four US states: California, South Carolina, Wisconsin, and New Jersey. This means that crypto investors in these states are unable to utilize Coinbase’s staking facilities. Coinbase has been fighting court cases against 10 US states regarding its retail staking services. The SEC filed a lawsuit against Binance on June 6, alleging that the exchange was violating securities law. On the same day, 10 US states filed their own court cases, claiming that Coinbase staking services are securities. Coinbase has refuted this statement, emphasizing that their staking services are not investments. Different states have initiated varying legal proceedings against Coinbase, with some requiring limitations on retail staking services. Coinbase is disappointed with the strict laws and is limiting its staking service in California, South Carolina, New Jersey, and Wisconsin.
Impact on Customers
- Customers who staked assets before June 6 in these four states will not be affected.
- Customers who staked assets after June 6 should pay attention to Coinbase’s help center for updates on changes to staking services.
- Business will continue as usual in the remaining six states: Maryland, Kentucky, Vermont, Illinois, Alabama, and Washington.
Staking is Crucial for Crypto’s Survival
Coinbase believes that staking is crucial for the survival of cryptocurrencies. They argue that almost every blockchain now follows a proof-of-stake model and that users are important for securing the blockchain. Coinbase also calls on customers to “Stand with Crypto” and advocates for pro-crypto policies through their grassroots campaign. Kraken’s Chief Legal Officer, Paul Grewal, has expressed support for Coinbase’s stance and promises to defend people’s right to stake.
Hot Take
The limitations on Coinbase’s staking service in certain US states highlight the challenges and regulatory hurdles faced by the crypto industry. While Coinbase continues to defend its staking services, it is clear that different states have different interpretations of securities laws. This situation emphasizes the need for clearer regulations and guidelines to ensure the growth and accessibility of cryptocurrencies.
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