The SEC’s Disapproval of Coinbase’s Role in Celsius Distribution
The United States Securities and Exchange Commission (SEC) is objecting to the use of crypto exchange Coinbase by Celsius, the bankrupt crypto lender, for distributing crypto assets to creditors. In a recent court filing, the SEC expressed its disapproval of Celsius Debtor’s proposal for Coinbase to act as the distribution agent for international customers. The SEC argues that the contract lacks clarity regarding Coinbase’s role in the distribution process. Despite Celsius’ claim that it won’t use Coinbase for brokerage services, the agreements suggest otherwise. The SEC also highlights an undisclosed agreement with Coinbase that has not been made available to their staff.
Celsius Creditors Support Bankruptcy Plan
Despite the SEC’s objection, Celsius creditors are strongly backing the bankruptcy plan. Paul Grewel, Coinbase’s chief legal officer, expressed bewilderment at the SEC’s objection and stated that Coinbase intends to challenge it in court. Meanwhile, most creditors support the bankruptcy plan, as revealed in a separate court filing. The Celsius Retail Borrower and General Earn creditor votes showed overwhelming support for the plan. Additionally, Michael Arrington, founder of Arrington Capital, has resigned from the board overseeing the bankruptcy plan, citing differences in board configuration.
Hot Take: SEC Raises Concerns About Coinbase’s Role
The SEC’s opposition to Coinbase assuming the role of distribution agent for Celsius raises concerns about transparency and clarity in their agreements. The lack of disclosure of an undisclosed agreement between Celsius and Coinbase is a key point of contention for the SEC. This case highlights the ongoing regulatory scrutiny faced by cryptocurrency exchanges like Coinbase and their involvement in various roles within the market. As this legal battle unfolds, it will have implications for both Celsius and Coinbase and may shape future regulations surrounding cryptocurrency exchanges.
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