Coinbase faces lawsuit from SEC over crypto trading.
SEC Files Lawsuit Against Coinbase for Allegedly Operating as an Unregistered Securities Exchange
The Securities and Exchange Commission has filed a lawsuit against Coinbase, alleging the company was working as an unregistered securities exchange.
What Happened?
The SEC lawsuit was filed Tuesday in the U.S. District Court for the Southern District of New York and claimed the crypto asset trading platform acted as an unregistered federal securities exchange, broker, and clearing agency. The SEC said it should be “permanently restrained and enjoined” from doing so.
According to the SEC, Coinbase failed to register with the agency before allowing customers to trade digital assets that the SEC considers securities. The lawsuit also alleges that Coinbase’s lending product, which allows customers to earn interest on certain digital assets, is a security and therefore subject to SEC regulation.
What Does This Mean?
The SEC’s lawsuit against Coinbase could have significant implications for the cryptocurrency industry as a whole. If the court rules in favor of the SEC, it could set a precedent for other crypto asset trading platforms to register with the agency or face legal action.
“You simply can’t ignore the rules because you don’t like them or because you’d prefer different ones: The consequences for the investing public are far too great,” said Gurbir Grewal, director of the SEC’s Division of Enforcement.
Stay Tuned for Updates
This story is breaking and will be updated as more information becomes available. In the meantime, investors and traders in the cryptocurrency space should pay close attention to developments in this case.
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