Coinbase CEO Brian Armstrong Defends Company Amid SEC Lawsuit, Contrasts With Binance Case

Coinbase CEO COIN Brian Armstrong has asserted that the lawsuit filed against his company by the U.S. Securities and Exchange Commission (SEC) is vastly different from the one filed against rival cryptocurrency exchange Binance BNB/USD.

Speaking to CNBC, Armstrong said the two firms are in stark contrast to each other, as are the legal actions they face.

The CEO clarified that the lawsuit against Coinbase did not involve the misappropriation of client assets. He also emphasized that he wasn't personally accused.

Armstrong added that Coinbase is a U.S.-based firm that hasn't operated any form of hedge fund or traded against its clients. "We, all our financial statements are audited, you know, the customer segregation, the funds, everything like that," he said.

Also Read: Congress Members Call On Treasury Department, IRS To Ink Rules For Taxing Crypto

The SEC took legal action against Coinbase on Tuesday, a day after initiating a similar lawsuit against Binance. Meanwhile, speaking at the Bloomberg Invest conference, Armstrong said that the SEC's approach towards Coinbase began to shift last year, preceding the lawsuit. 

"They started to come to us with more questions about the business, so we were very forthcoming," Armstrong said. "Unfortunately we were met with silence."

He also pointed out that a small fraction of the traded assets on Coinbase's platform, only 13 out of over 200, were identified as securities by the SEC.

This comes amid an expanding crackdown on cryptocurrency by the SEC, with allegations against Binance of mishandling customer funds, misleading investors and regulators, and violating securities rules.

Despite facing regulatory pressure at the state level to halt its staking service, Armstrong declared, "We are not going to wind down our staking services. As these court cases play out, it’s really business as usual."

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Photo: Coinbase