Hey Peeps! On March 22nd, Coinbase announced, via a , that they have received a Wells Notice from the U.S. Securities and Exchange Commission (SEC) regarding potential violations of securities law. blog post These potential violations reportedly stem from Coinbase’s listed digital assets and various products/services like Coinbase Earn, Coinbase Prime, and Coinbase Wallet. A Wells Notice is a formal letter, sent by securities regulators to the prospective defendant, notifying the recipient of impending charges or enforcement actions. This is also not entirely unsurprising, as , that the SEC was launching a probe into Coinbase’s business operations and the listing of cryptocurrencies, related to securities violations. reports surfaced back in mid-2022 The company stated in its blog post that “Coinbase products and services will continue to operate as usual”, to let customers know that nothing is changing at the moment. Coinbase CEO Brian Armstrong took to to let Coinbase customers know about the Wells notice and that enforcement action is to be expected. Twitter “Tell us the rules and we will follow them. Give us an actual path to register, and we will register the parts of our business that need registering. In the meantime, the U.S. cannot afford for regulators to continue to threaten the good actors in the crypto industry for doing the same legal and compliant things they’ve always done. This unfair approach will only drive innovation, jobs, and the entire industry overseas. At our core, we are the very same company that we were on April 14, 2021 when we became a public company at the end of the lengthy process with the SEC itself. We remain confident in the legality of our assets and services, and if needed, we welcome a legal process to provide the clarity we have been advocating for and to demonstrate that the SEC simply has not been fair or reasonable when it comes to its engagement on digital assets. In the meantime, Coinbase will continue to do what we do best: updating the financial system by building the most trusted products and services to advance our mission of creating more economic freedom and opportunity around the world.” - , Chief Legal Officer of Coinbase Paul Grewal Coinbase’s Chief Legal Officer, Paul Grewal, brings up some great points in the blog post, specifically how the SEC only recently started viewing crypto as securities, and the simple fact the SEC reviewed Coinbase’s business operations in 2021 and raised no concerns back then. Another important note to remember about this whole situation is that Coinbase has consistently reached out to the SEC for regulatory guidance and has gotten nothing but silence. Instead of working with crypto companies to build a comprehensive framework for the crypto industry, the SEC only seems intent on dishing out punishment. Grewal even brought up the recent Voyager/Binance case, which , where Judge Michael Wiles laid a verbal smackdown on SEC and CFTC for essentially wasting the court’s time by not being able to explain their legal objections. I have covered extensively I never wanted to see this happen to Coinbase, and I can’t help but be concerned after hearing this news. Just as Coinbase was picking up steam, like their recent , this SEC notice out of nowhere will certainly cause issues; at least in the short term. partnership with Brazil I could certainly see Coinbase’s stock price taking a huge hit, and I expect a wave of crypto customers to be withdrawing their crypto from the exchange to be safe and secure. Back during the collapse of FTX, I hastily withdrew all my crypto assets from Coinbase, and all centralized exchanges, to my Ledger hardware wallet. Looking back on that move, I am a bit thankful I did so, as this type of drama is the last thing I want to deal with. Worrying about whether my crypto will be safe or not is just not worth the relative ease of having it stored on centralized exchanges. At the end of the day, I truly think the SEC’s case is weak, and I believe Coinbase will prevail if it comes down to it. What are your thoughts on this news? Do you think Coinbase could be toppled as a result of this impending enforcement action? Hypothetically, if Coinbase collapses, which exchange do you think would be the leader of the US market? Enter my on Publish0x to win yourself some free Crypto! Monthly Giveaway Check out my Socials: https://linktr.ee/zerorequiem0x See ya! :) Also published here
