The U.S. Securities and Exchange Commission (SEC) said it plans to sue Coinbase.
The warning marks the latest phase in a long-running dispute between
the SEC and the digital-asset firm over its listed tokens.
- Coinbase
said in a filing that it received a Wells Notice from the SEC on
Wednesday announcing a “preliminary determination” to file an
enforcement action against the crypto firm.
- A Wells Notice
is sent after an investigation is complete and gives the company time
to rebut the SEC's allegations before enforcement actions are pursued.
- The
notice took issue with aspects of Coinbase's exchange, including some
of its listed digital assets and its staking service Coinbase Earn and
Coinbase Wallet.
- SEC Chair Gary Gensler has previously said that crypto firms need to register many of their tokens and products as securities.
- Coinbase
maintains that its tokens and products do not classify as securities
and argues that its internal vetting process is thorough.
- SEC scrutiny of crypto firms has increased after the collapse of crypto exchange FTX, which may have left investors with billions of dollars worth of losses.
