{"id":19085,"date":"2023-06-06T12:52:41","date_gmt":"2023-06-06T12:52:41","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/crypto\/sec-sues-coinbase-in-ny-federal-court-for-offering-unregistered-securities\/"},"modified":"2023-06-06T12:52:43","modified_gmt":"2023-06-06T12:52:43","slug":"sec-sues-coinbase-in-ny-federal-court-for-offering-unregistered-securities","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/crypto\/sec-sues-coinbase-in-ny-federal-court-for-offering-unregistered-securities\/","title":{"rendered":"SEC sues Coinbase in NY federal court for offering unregistered securities"},"content":{"rendered":"
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The United States Securities and Exchange Commission has filed a lawsuit\u00a0against New York-based crypto exchange Coinbase for offering unregistered securities.<\/p>\n

The SEC lawsuit alleged that\u00a0Coinbase has never registered as a broker, national securities exchange or clearing agency, evading the disclosure scheme for securities markets. SEC alleged that several tokens offered by the crypto exchange including\u00a0 Solana (SOL),\u00a0 Cardano (ADA), Polygon (MATIC) Filecoin (FIL), Sandbox (SAND), Axie Infinity (AXS), Chiliz (CHZ), FLOW, ICP, NEAR, VGX, DASH, and NEXO qualify as securities.<\/p>\n

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Today we charged Coinbase, Inc. with operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency and for failing to register the offer and sale of its crypto asset staking-as-a-service program.https:\/\/t.co\/XPG2gDkxtV pic.twitter.com\/hCdVMw8B2v<\/a><\/p>\n

\u2014 U.S. Securities and Exchange Commission (@SECGov) June 6, 2023<\/a><\/p><\/blockquote>\n

The lawsuit further alleged that Coinbase has been operating as an unregistered security broker since 2019, almost two year before its initial public offering (IPO) in April 2021.<\/p>\n

The lawsuit alleged that coinbase\u2019s staking program includes five stackable crypto assets, making the staking program an investment contract and therefore a security. Coinbase was already fighting the staking battle with the SEC and had claimed its\u00a0staking products do not qualify as a security, despite Kraken settling with the SEC and winding down its s<\/p>\n

SEC chief Gary Gensler while addressing the latest Coinbase lawsuit\u00a0said\u00a0<\/a>that the crypto exchange allegedly deprived its customers of\u00a0critical protections that prevent fraud and manipulation, and avoided proper disclosure, and safeguards against conflicts of interest.<\/p>\n

Coinbase share price dropped by 15% in pre-trading after SEC announced its lawsuit on June 6.<\/p>\n

Coinbase share price movement. Source: Google<\/em><\/figcaption><\/figure>\n

The SEC lawsuit against Coinbase comes just a day after the securities regulator sued Binance for violating securities law and comingling customer’s funds. While Binance was charged with 13 counts of violations under various securities laws, the allegations against Coinbase have puzzled many in the crypto industry primarily because Coinbase is a publicly listed company,<\/p>\n

Many in the crypto community questioned how Coinbase was allowed to go public in 2021 when it has been operating as an unregistered security broker. One crypto influencer that goes by the Twitter name of The Wolf said, SEC suing Coinbase could cut some slack for Binance as well.<\/p>\n

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So in SEC’s complaint vs Coinbase, it states that they’ve been acting as an unregistered broker since 2019.<\/p>\n

Yet…. the on April 14th, 2021 $COIN<\/a> became a public company on the Nasdaq.<\/p>\n

How on God’s green earth do they possibly believe this lawsuit will ever hold up in court?\u2026 pic.twitter.com\/tYyEroRN6F<\/a><\/p>\n

\u2014 The Wolf (@WolfOfPoloniex) June 6, 2023<\/a><\/p><\/blockquote>\n

This is a developing story, and further information will be added as it becomes available.\n<\/p>\n