Coinbase, the famous crypto exchange, recently announced that it had received a Wells notice from the United States Securities and Exchange Commission which recommended the regulator should be taking enforcement action.
In a blog post on the 22nd of March, the exchange also stated that this legal threat could ideally target the staking program of the exchange. A notice letter from Wells usually warned a company that the SEC could be following up with an enforcement action- but the crypto exchange had also provided a few details other than the possible violations of securities laws. Paul Grewal, the chief legal officer of the firm, also stated that they had asked the SEC to identify which of the assets on the platforms could be securities- and they had declined to do that as well.
Coinbase Could Be Facing An investigation From The SEC
Coinbase also stated that the services and products would readily work to operate amid the usual investigation. Grewal also pushed back against this approach- which had often been cited by SEC Chair Gary Gensler- where he claimed that the crypto exchange would be meeting with the SEC representatives more than 30 times over a period of nine months- but never really received feedback on the multiple proposals. He stated at no single point during the investigation did the SEC tell the firm about a single specific concern for a single asset on the platform.
Coinbase also submitted a petition to the SEC on the 20th of March- in their effort to explain to the regulator that it might not necessarily be considered as a security. The exchange also claimed that none of the listed assets were ever considered securities under the purview of the regulator- as well as any potential targeting of the wallet based on a misunderstanding of crypto products, services, and assets by the SEC.