Securities and Exchange Commission (SEC) instructed Coinbase (NASDAQ:COIN), a cryptocurrency exchange, to halt trading on all cryptocurrencies except Bitcoin (CRYPTO: BTC), prior to initiating legal action against the company.
What Happened: Brian Armstrong, CEO of Coinbase, told Financial Times that the SEC had recommended delisting over 200 tokens offered by the exchange, identifying 13 of them as securities.
"They [SEC] said . . . we believe every asset other than bitcoin is a security," Armstrong was quoted as saying. "And, we said, well how are you coming to that conclusion, because that's not our interpretation of the law. And they said, we’re not going to explain it to you, you need to delist every asset other than bitcoin."
Armstrong expressed disagreement with the SEC’s classification, stating that it diverged from their interpretation of the law.
Given the implications of delisting for the entire crypto industry in the US, Coinbase decided to contest the SEC’s demand in court to seek legal clarity. Armstrong stated, “It kind of made it an easy choice… let's go to court and find out what the court says.”
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Why It Matters: Notably, Ethereum (CRYPTO: ETH), the second-largest cryptocurrency, was not included in the SEC’s case against Coinbase, nor did it feature in the list of “crypto asset securities” outlined in the SEC’s lawsuit against Binance.
Determining whether all or any crypto tokens should fall under the SEC’s purview remains a contentious debate among US authorities.
Price Action: At the time of writing, BTC was trading at $29,418 up 0.31% in the last 24 hours, according to Benzinga Pro.
Photo Courtesy: Shutterstock.com
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