SEC Files Charges Against Cryptocurrency Platform Coinbase
07/06/2023
One day after filing civil charges against global cryptocurrency exchange Binance, the U.S. Securities and Exchange Commission accused Coinbase Inc. of operating as an unregistered broker, further asserting the agency’s claim of jurisdiction over the digital assets sector.
In a federal lawsuit filed in Manhattan on Tuesday, the SEC accused the U.S.-based digital assets trading platform operates both as a securities exchange, broker and clearing agency without having registered for any of those roles, depriving investors of transparency into risks and safeguards against conflicts of interest.
The SEC further alleged in the lawsuit that Coinbase failed to register its “staking-as-a-service” program, which offers customers a yield in return for tying up their cryptocurrency as a security.
The complaint, which also identifies parent company Coinbase Global Inc. as a “control person” of Coinbase Inc., states that the trading platform raked in billions of dollars in income from the unregulated activities since 2019 and seeks unspecified disgorgement plus interest and penalties.
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