In a surprising revelation, Coinbase CEO Brian Armstrong claimed that the U.S. Securities and Exchange Commission (SEC) had previously asked the cryptocurrency platform to halt trading in all digital currencies except Bitcoin.
- The SEC asked Coinbase to stop trading all digital currencies except Bitcoin.
- Complying with this demand would have signaled the end of the US crypto industry.
- Coinbase decided to battle it out in court to challenge the SEC’s demand.
The SEC alleged that Coinbase was operating unlawfully and accused it of trading securities without registration.
- The SEC accused Coinbase of trading at least 13 crypto assets, including Solana, Cardano, and Polygon, which it deemed as securities.
- Coinbase argues that SEC rules are ambiguous and that the agency is overstepping its authority.
- The SEC’s enforcement division denied making formal requests for companies to delist crypto assets.
The lawsuit against Coinbase is part of SEC Chair Gary Gensler’s initiative to assert control over the crypto industry.
- Gensler believes the crypto industry has eroded investor trust in the U.S. capital markets.
- The legal battle with Coinbase follows a similar lawsuit against Binance in June.
Australian Lawyer Bill Morgan pointed out that Coinbase had already suspended trading of XRP, challenging the SEC’s stance on crypto assets.
Hot Take: The battle between Coinbase and the SEC highlights the ongoing struggle for regulatory clarity in the crypto industry. As the SEC asserts control, crypto companies are pushing back, arguing that the rules are unclear and that the agency is overstepping its bounds. This legal battle could have significant implications for the future of the crypto industry in the United States.
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