Kevin O'Leary Dumps Coinbase, Robinhood Shares, Calling Them 'Toxic Waste': Here's Why The 'Shark Tank' Investor Says The Duo Is Dead Money

O'Shares ETFs chairman and renowned "Shark Tank" investor Kevin O'Leary sent Coinbase Global Inc COIN and Robinhood Markets Inc HOOD to the chopping block on Wednesday.

What Happened: The O'Shares ETF's chair said he sold Coinbase shares for a significant loss in what he called a "brutal trade" Wednesday on CNBC's "Fast Money Halftime Report."

"I got out because of the war that they are taking on with the regulator," O'Leary said. "I have come to the conclusion in my investing career that when you litigate the regulator, that's never a good outcome."

The SEC has alleged that several cryptocurrencies involved in an insider trading lawsuit surrounding a former Coinbase employee are actually securities. Coinbase and the crypto market will remain tainted until the regulatory issues are resolved, O'Leary said. 

"Coinbase has gone to war with the regulator and I'm a regulated guy ... I don't want to own any shares of a company that has gone to war with the regulator that regulates me. No, thanks," he said.

O'Leary told CNBC he took a big loss on his Coinbase position.

"When I lose money like that, I cry like a baby. It just makes me sick," he said. 

See Also: Copy-Paste Hack? $190M Stolen From Coinbase-Backed Crypto Bridge Nomad

The famed "Shark Tank" investor also cut Robinhood from his portfolio "because it's part of that taint," he said.

Any name that falls under the cloud of crypto or non-regulated trading is going to be dead money for a while, O'Leary said. 

"I might as well take my pain, take the loss, move on and wait for this drama to play out in Washington, D.C.," he said.

O'Leary is optimistic that regulation will play out in the fall, but he expects Coinbase and Robinhood to be stuck in the mud until then.

"This stuff is coming, but I think these names are toxic waste until it's resolved," he said.

COIN, HOOD Price Action: Coinbase was up 20.20% Wednesday afternoon at $80.81 and Robinhood was up 11.70% at $10.31, according to data from Benzinga Pro.

Photo: Randstad Canada from Flickr