After SEC Pressure, Coinbase Decides To Drop Interest Product
22 September 2021 - 10:28AM
NEWSBTC
It was just a couple weeks ago that Coinbase posted a blog post,
paired with a hefty Twitter thread from CEO Brian Armstrong
highlighting recent challenges with the SEC. Armstrong described
the agency’s behavior as “sketchy” after the SEC seemingly
threatened the exchange that a lawsuit would be impending should
Coinbase launch their expected interest-yielding product,
Lend. If Armstrong’s tweet thread didn’t give it away, the
company’s blog post, spearheaded by Chief Legal Officer Paul
Grewal, was undoubtedly lined with some of the firm’s frustrations.
Now, less than a month later, reports have emerged that Coinbase
has elected to halt it’s plans to launch Coinbase Lend. A Threat To
DeFi? The news comes less than a week after SEC Chairman Gary
Gensler told CNBC that his commission is under-staffed. Gensler
echoed those sentiments in a Senate testimony last week, stating
that the SEC “needs a lot more people.” He added in the testimony
that he believed previous judiciary decisions established that many
cryptocurrency tokens “do come under the securities law.” Gensler
took the role with the SEC earlier this year, and came in with high
expectations from retail investors. Elsewhere in the market, some
state regulators seem to be working to try to fill the SEC’s role
with interest-yielding products already on the market. A handful of
state regulators in recent months started legal action against
BlockFi for it’s lending products. In the past week, some state
regulators have shifted focus to pursue action against Celsius as
well. New Jersey, Texas and Alabama are three states that are
pursuing both BlockFi and Celsius with claims that the firms are
offering residents unregistered securities. Regardless of the
eventual outcome, the growing popularity of yield-generating tokens
and stablecoins are becoming of increased importance to regulators,
and are likely bound to be responsible for federal oversight at a
higher level than currently seen. The timetable and degree of
oversight remains 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:
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Coinbase Rumblings The powerhouse exchange continues to build on
their flagship products to deliver business growth. Last week, the
exchange issued a high-demand junk bond with orders amounting to
$7B. In recent months, the company announced it’s intent to launch
a “crypto app store” and added payment support for Apple Pay. Safe
to say it’s been a busy quarter for the bustling exchange. However,
it remains to be seen what the end result is for competitors like
BlockFi and Celsius. In the meantime, it seems that Coinbase may be
working to try to propose regulatory framework that can help the
SEC and other regulatory figures embrace the market without
overstepping boundaries for crypto consumers. Related Reading |
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