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Coinbase Denies Claims It Lists Securities As SEC Drops Investigation

Major crypto exchange Coinbase has denied accusations that it lists securities on its platform after the US Securities and Exchange Commission (SEC) embarked on an investigation into the listing of crypto assets. Digital assets should be registered as securities.

In a recent blog post, Coinbase’s Chief Legal Officer, Paul Grewal, stated that none of the assets listed on their platform are securities, adding that the process by which they determine whether an asset is an asset. Whether digital is a security or not has been reviewed by the SEC itself.

Coinbase has a rigorous process to analyze and review each digital asset before making it available on our exchange – a process that the SEC itself has reviewed,” he said.

Grewal detailed that after the U.S. Department of Justice (DOJ) opened an investigation into the misuse of confidential information by a former Coinbase employee related to listing decisions, the SEC separately filed charges securities fraud against this individual.

According to the DOJ, as reported, a former employee of the exchange violated insider trading rules by disclosing information to help his brother and a friend buy tokens shortly before they are listed on the platform, generating “realized and unrealized profits totaling at least approximately [USD] 1.5 million.”

They traded at least 25 different crypto assets right before the listing announcement. The SEC alleges that the nine cryptocurrencies involved are securities, Grewal said in the blog post, adding that the DOJ “reviewed similar events and chose not to file securities fraud allegations.” to those involved.”

In a recent tweet, Commissioner Caroline Pham of the U.S. Commodity Futures Trading Commission (CFTC) called the SEC’s investigation “an outstanding example of ‘regulation by enforcement’.” She said the SEC’s allegations “could have broad implications beyond this single case, underscoring how important and urgent it is for regulators to work together.”

We agree with Commissioner Pham and, respectfully, 100% disagree with the SEC’s decision to file these securities fraud allegations and the nature of the allegations,” Grewal stated.

Grewal said that the SEC’s fees highlight the critical issue that “the United States does not have a clear or workable regulatory framework for digital asset securities.”

And instead of creating the right rules in a comprehensive and transparent way, the SEC is relying on these types of one-time enforcement actions to try to bring all digital assets into jurisdiction,” he stated. rights, even assets that are not securities“.