Nasdaq-listed crypto exchange Coinbase has denied the US Securities and Exchange Commission (SEC) allegation that nine crypto assets traded on its platform are securities. The company’s chief legal officer insisted: “Coinbase does not list securities. End of story.”
Coinbase says it does not list crypto asset securities
The US Securities and Exchange Commission (SEC) alleged that cryptocurrency exchange Coinbase listed nine crypto asset securities in a complaint filed on Thursday. The securities regulator has accused a former Coinbase employee of “violating the anti-fraud provisions of securities laws” related to insider trading.
The SEC said in its complaint that the crypto tokens AMP, RLY, DDX, XYO, RGT, LCX, POWR, DFX and KROM are unregistered securities.
However, Coinbase immediately denied the SEC’s allegation that some of the coins traded on its platform are crypto securities. Paul Grewal, the exchange’s chief legal officer, emphasized in a blog post on Thursday: “Coinbase does not list securities on its platform. End of story.”
The SEC alleges that the nine digital assets involved are securities. The DOJ reviewed those same facts and decided not to file securities fraud charges against those involved.
Coinbase’s chief legal officer cited a statement from Commodity Futures Trading Commission (CFTC) commissioner Carolyn Pham, who said the SEC’s actions “are a shining example of regulation by enforcement.”
We agree with Commissioner Pham and, respectfully, disagree 100% with the SEC’s decision to file these securities fraud allegations and the gist of the allegations themselves.
Grewal claimed that “Coinbase has a rigorous process for analyzing and reviewing each crypto asset prior to listing and trading on its platform”.
“The process includes an analysis of whether the asset can be considered a security, and also considers the regulatory compliance and information security aspects of the asset,” he described.
The chief legal officer noted that Coinbase cooperated with the SEC’s investigation into the insider trading case involving a former Coinbase employee. Noting that seven of the nine crypto assets mentioned in the complaint by the SEC are listed on the Coinbase platform, he said:
Instead of negotiating with us about seven properties on our platform, the SEC jumped straight into litigation.
The Coinbase official stressed: “The SEC’s allegations highlight a critical problem: the US does not have a clear or workable regulatory framework for digital asset securities.”
On Thursday, Coinbase also announced that it has filed a petition with the SEC urging the regulator to “start making regulations on digital asset securities.” Exchange detailed: “Our petition calls on the SEC to develop a workable regulatory framework for digital asset securities guided by formal procedures and a public notice-and-comment process, rather than arbitrary enforcement or guidance developed behind closed doors. I through.”
What do you think about Coinbase which disputes the SEC’s allegation that some crypto tokens traded on its platform are securities? Let us know in the comments section below.
An Austrian economics student, Kevin found bitcoin in 2011 and has been an evangelist ever since. His interest lies in bitcoin security, open-source systems, network effects, and the intersection between economics and cryptography.
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