SEC Urged Coinbase to Halt All Crypto Trading, Except Bitcoin

In the latest news rocking the crypto world, the U.S. Securities and Exchange Commission (SEC) reportedly urged the popular cryptocurrency platform, Coinbase (COIN.O), to halt all crypto trading, except Bitcoin, prior to a lawsuit filed in June. CEO Brian Armstrong revealed this unexpected demand in an interview with the Financial Times.

Armstrong explained the company's position, saying, “We really didn't have a choice at that point. Delisting every asset other than bitcoin, which by the way is not what the law says, would have essentially meant the end of the crypto industry in the U.S.” As a result, Coinbase decided to face the SEC in court.

The SEC Coinbase lawsuit, however, is not merely about the delisting of assets. The regulatory body accused Coinbase of operating illegally because it had failed to register as an exchange. It further alleged that Coinbase traded at least 13 crypto assets that should have been registered securities, including popular tokens like Solana, Cardano, and Polygon.

Despite these allegations, the SEC claimed its enforcement division did not formally instruct companies to delist crypto assets. According to the Financial Times, the SEC stated that during an investigation, the staff may share their views on what conduct could raise questions under securities laws.

Reacting to this report, a spokesperson for Coinbase clarified that the SEC had never officially stated that all assets other than Bitcoin were securities. They added that such formal requests would require the approval of the full commission.

The spokesperson further said, “We continue our discussions with the Commission, but believe that transparent and fair rulemaking and Congressional action represent the best path forward for American crypto users and the companies building the crypto-economy in the US.”

This SEC Coinbase lawsuit is part of a broader initiative led by SEC Chair Gary Gensler, who aims to assert the commission's jurisdiction over the fast-growing crypto industry. Gensler has previously described the crypto industry as a “Wild West”, causing damage to the trust of investors in the U.S. capital markets.

In response, crypto companies argue that the SEC's rules are unclear and the agency is overreaching in its attempts to regulate them. The SEC has yet to respond to requests for comments on this report.

Stay tuned for more updates on the SEC Coinbase lawsuit and other latest news from the cryptocurrency world. Be sure to download the WikiFX App to keep up with the fast-paced world of crypto.

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