cryptodaily.co.uk
Per a report by Bloomberg, the U.S. Securities and Exchange Commission (SEC) is reportedly investigating Coinbase over whether it improperly allowed Americans to trade digital assets that should have been registered as securities after it expanded its line of crypto offerings last week.
Regulatory scrutiny into the exchange has increased since Coinbase expanded the number of digital tokens it offers for trading. Along with that, Coinbase suffered heavy blows last week when a former product manager, along with two others was charged with insider trading in the first such case involving cryptocurrencies. The charges have been brought forward by the Department of Justice and the SEC and allege that the former employee tipped his brother and friend on crypto assets due to be listed on the exchange. The SEC filed additional securities fraud charges against the accused, saying that nine digital assets involved in the alleged insider trading were securities.
Coinbase maintains that it does not list securities on its platform, with the company’s chief legal officer Paul Grewal stating that “We 100% disagree with the SEC’s assertion that any of the crypto assets we list are securities.” Grewal continued to say,
None of these assets are securities. Coinbase doesn’t list securities. Period.
Grewal elaborated that Coinbase has a process that analyses and reviews all digital assets before they are made available on the exchange – a process that the SEC has reviewed.
We are confident that our rigorous diligence process—a process the SEC has already reviewed—keeps securities off our platform, and we look forward to engaging with the SEC on the matter, Grewal said.
Coinbase is the largest U.S trading platform and lets users trade more than 150 tokens. SEC Chair Gary Gensler has previously said that Coinbase should register as a national securities exchange due to some of its listed cryptocurrencies. Should one of those products be deemed securities, the firm would need to register as an exchange with the SEC to remain operational. The cryptocurrency platform has previously asked the regulator to develop rules that work for digital asset securities.
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