US SEC Probes Coinbase Over Unregistered Securities
According to reports, the US SEC is investigating the crypto exchange platform, Coinbase. The SEC alleged that the platform might be allowing Americans to trade crypto assets that are securities. Yet, Coinbase did not register any securities with the regulator.
However, Reuters reported that a spokesperson for Coinbase has denied the allegations. The spokesperson said the company did not list securities on the exchange.
Moreover, Paul Grewal, the legal head for Coinbase, stated that the company is ready to take up SEC on the matter. Grewal added that:
“We are very confident of our rigorous checking process. SEC has also reviewed this process. We try as much as possible to keep securities away from our exchange.”
SEC Accuses Coinbase Of Listing Securities On Its Exchange
Meanwhile, the scrutiny of SEC on Coinbase increased after the exchange added more tokens to the platform. In the past months, Coinbase has increased its tokens to over 150.
If the regulator’s investigation reveals that some of these tokens are securities, Coinbase must register them with the SEC.
However, the watchdog has not revealed more information about the probe. Last week, the enforcement unit of the regulator accused Coinbase of insider trading.
The Unites States prosecutors charged Coinbase’s ex-product manager, Ishan Wahi, for engaging in insider trading. From time to time, Coinbase usually adds more tokens to its platform to meet users’ needs.
Top executives in the company usually know the tokens the firm will add. The report alleged that Wahi shared confidential information related to upcoming crypto announcements.
SEC Tags Nine Tokens As Securities
In another related charge, the regulator claimed that Nikhil Wahi and another individual, Sameer Ramani bought and sold over 25 digital assets.
However, the agency alleges that nine of the assets were securities. The tokens include POWR, KROM, ALCX, ENS, DDX, DFX, RGT, RLY, and GALA.
Meanwhile, SEC has not stated if it would take legal action against Coinbase exchange for adding the tokens tagged “securities.”
Last week, the crypto exchange had asked the regulatory agency to develop rules for crypto asset securities. The reason was to bring more regulatory clarity on the usage of securities.
Meanwhile, the CFTC and DOJ have commented on the matter concerning the nine tokens that the SEC alleges are securities. Caroline D. Pham, CFTC’s commissioner, noted that this was a rash decision from the SEC.
Pham believes that this could have a ripple effect on future disputes and matters related to digital assets.
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