It was just a few weeks ago that Coinbase posted a blog post, highlighting the SEC’s recent challenges with a heavy Twitter thread from CEO Brian Armstrong.
Armstrong described the agency’s behavior as “sketchy” after the SEC ostensibly threatened the exchange, saying a lawsuit would be pending if Coinbase launched their expected interest-generating product, Land. If Armstrong’s tweet thread didn’t give it away, the company’s blog post, led by chief legal officer Paul Grewal, was no doubt linked to some of the firm’s frustrations.
Now, less than a month later, reports have surfaced that Coinbase has chosen to discontinue plans to launch Coinbase nd.
Threat to defy?
SEC chairman Gary Gensler told CNBC that the news came less than a week after his commission was understaffed. Gensler echoed this sentiment in a Senate testimony last week, that the SEC “needs more people.” He added in testimony that he believes the judiciary’s previous decisions established that many cryptocurrency tokens “fall under the securities law.” Gensler joined the SEC earlier this year, and came up with high expectations from retail investors.
Elsewhere in the market, some state regulators already seem to be trying to fill the role of the SEC with interest-generating products in the market. In recent months, a handful of state regulators have taken legal action against blockchain for its products. Last week, some state regulators also focused on taking action against Celsius. New Jersey, Texas and Alabama are three states that are pursuing both blockchain and Celsius, claiming that the agencies are offering residents unregistered securities.
Whatever the end result, the growing popularity of yield-producing tokens and stable currencies is gaining increasing importance among regulators, and is forced to be held accountable for federal oversight at a higher level than is currently seen. The schedule and degree of supervision remain to be seen.
Coinbase is the first crypto exchange to be publicly traded on a major U.S. stock exchange, but has posted modest results in it's short time on the market. | Source: COIN - NASDAQ on TradingView.com
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Elsewhere in the Coinbase Rumblings
The Power House Exchange has continued to provide business growth on their flagship products. Last week, Exchange B issued a high-demand junk bond with a 1 billion order. In recent months, the company has announced that it intends to launch a “Crypto App Store” and has added payment support for Apple Pay.
It’s safe to say that it was a busy quarter for exciting exchanges. However, it remains to be seen what the end result will be for competitors like BlockFi and Celsius. Meanwhile, it seems that Coinbase is trying to propose a regulatory framework that could help the SEC and other regulatory figures take the market beyond the borders of crypto customers.
Related Reading | Despite the dips, bitcoin exchange reserves have reached their lowest levels since 2018.
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