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We don’t need more digital currency, says Gensler after SEC files suit against Coinbase

War on crypto? SEC indicates it’s time for regulatory fire

Barely 24 hours after slamming Binance with a 13 charges lawsuit, the US Security and Exchange Commission (SEC) has filed a new suit against Coinbase. The suit alleges that Coinbase traded unregistered securities. 

The suit represents worsening conditions for crypto companies and operators in the US. 

Coinbase under fire 

The top regulator on Wall Street, the SEC, has filed a lawsuit against the largest crypto exchange in the US, Coinbase. The suit accuses Coinbase of evading the disclosure regime established by Congress for the securities market. “

In a complaint filed on Tuesday in federal court, the SEC stated: “Coinbase has never registered with the SEC as a broker, national securities exchange, or clearing agency.”

“Today we charged Coinbase, Inc. with operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency and for failing to register the offer and sale of its crypto asset staking-as-a-service program,” the regulator added.

The suit follows a run of regulatory crackdown which has seen the regulator file a similar complaint against Binance barely a day ago. 

Ten states in America have issued Coinbase a show cause notice after the federal regulator filed charges against the US-based exchange. The Alabama Securities Commission issued the document, giving the business 28 days to show why a cease-and-desist order shouldn’t be issued.

Alabama, California, Illinois, Kentucky, Maryland, New Jersey, South Carolina, Vermont, Washington, and Wisconsin are among the ten states that have issued the company with the notice. The possibility of the exchange getting a cease-and-desist order for the sale of unregistered securities has also increased.

Read more: Coinbase Derivatives Exchange to roll out BTC and ETH futures

SEC Chair makes Damning statement

Following the announcement of the suit against Coinbase, SEC Chair Gary Gensler have said in a damning interview with CNBC that: “we don’t need more digital currency.”

He noted that the crypto industry is built on a business model of non-compliance which makes it not acceptable in traditional finance. 

“We already have digital currency,” he added. “It’s called the U.S. dollar. It’s called euro. It’s called the yen. They’re all digital now.”

Since Gensler assumed office, the regulator has gone hard on crypto companies and intensified following the setbacks in the crypto space last year. FTX collapse has created broad reason for the regulator to go after crypto firms that have been accused of commingling customer funds to make risky bets. 

Disclaimer: CryptoPlug does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.

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