Coinbase Receives SEC Wells Notice for Potential Law Violations
• Coinbase has received a Wells notice from the US Securities and Exchange Commission recommending the regulator take enforcement action.
• The legal threat could potentially target Coinbase’s staking program, listed digital assets, its wallet or Coinbase Prime services.
• Despite meeting with SEC representatives multiple times over nine months, Coinbase has not received feedback on its proposals from the regulator.
Coinbase Receives Wells Notice from SEC
Coinbase, a crypto exchange, recently received a Wells notice from the United States Securities and Exchange Commission (SEC). This is an official document warning that the SEC may follow up with an enforcement action against them. It is unclear what specific violations they are accused of.
Potential Targets of Enforcement Action
The potential targets of this enforcement action include Coinbase’s staking program, listed digital assets, its wallet and Coinbase Prime services. However, no details have been provided as to which asset is under investigation by the SEC.
Coinbase Attempts to Explain Staking to Regulator
Coinbase submitted a petition to the SEC on March 20th in an effort to explain why staking might not be considered universally as a security according to their regulations. They also claimed that none of their listed assets were considered securities under their purview and that any potential targeting of its wallet was based on a “misunderstanding” by SEC officials.
Coinbase Meets With SEC Multiple Times
Despite meeting with representatives from the US Securities and Exchange Commission more than 30 times over nine months, Coinbase has largely not received feedback on its proposals from the regulator yet there remains no indication as to whether or not these meetings have been productive in any way.
Services Will Remain Operational During Investigation
In light of this news, Coinbase announced that all its products and services will continue to operate as usual during this period while it awaits further information regarding any possible enforcement action taken against them by the SEC regulator.