Coinbase, the largest cryptocurrency exchange in America, finds itself in legal turmoil just a day after the SEC unleashed a wave of charges against Binance. The regulatory agency has filed a comprehensive 101-page lawsuit against Coinbase, mirroring the allegations made against Binance.
The SEC claims that Coinbase has neglected to register as a broker, national securities exchange, or clearing agency, despite actively performing the functions associated with all three.
Furthermore, the SEC accuses Coinbase of violating securities laws by enabling the trading of assets on its platform that meet the criteria set forth by the Howey Test. Despite outwardly expressing a desire to comply with regulations, Coinbase allegedly falls short by allowing these securities to be traded. Among the mentioned assets are prominent cryptocurrencies such as SOL, ADA, and MATIC.
In a scathing statement, the commission asserts that Coinbase prioritizes its profit agenda over the interests of investors and compliance with the law that governs the securities markets. The SEC highlights Coinbase’s failure to register its staking-as-a-service product, alleging that this omission has deprived investors of crucial information about the program.
Coinbase had foreseen the possibility of such a lawsuit months ago, but the company maintains its stance that staking products do not fall under the category of securities. Despite this claim, the SEC seeks relief by demanding that Coinbase surrender its wrongfully obtained gains and pay prejudgment interest.
As the legal battle unfolds, Coinbase faces the challenge of addressing the SEC’s allegations and defending its position while the cryptocurrency industry continues to navigate the evolving regulatory landscape.
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