As the news of the recent U.S. The Securities and Exchange Commission’s move against Coinbase, the top U.S. cryptocurrency exchange, has made headlines and prompted an existential discussion about what it might imply for cryptocurrencies in the country.
In light of this, Caitlin Long, the founder, and CEO of Custodia Bank, took to Twitter to express her views. She added that the recent White House economic report was seen as having “dunked” on all financial innovation while espousing the “stability” of traditional banks. She wrote in the tweet that “it should be obvious by this point that the Biden Administration wants all cryptocurrency—even the legitimate parts of it—run out of the United States.”
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The Debate and Allegations
Long and other members of the cryptocurrency community have questioned why the Securities and Exchange Commission suddenly delivered a so-called “Wells Notice” after allowing Coinbase, a publicly traded company, to offer staking rewards for several years, and why the SEC is only now threatening to sue Coinbase on the grounds that it is providing unregistered securities.
According to Coinbase’s Chief Legal Officer, Paul Grewal, the company has met with the SEC more than 30 times in the last nine months to share information about its operations and pave the way for registration. He further mentioned that, up until they received a Wells notice, the SEC had not provided any guidance on what to correct or how to register. The SEC will notify a corporation via a “Wells notice” when it plans to take enforcement action against them.
Crypto Community’s Reactions
Chriz Dixon, the general partner at Andreessen Horowitz, defended Coinbase by saying that the exchange platform had made significant investments to be fully compliant with American laws, even when doing so made them move more slowly or cost them a competitive edge over other exchanges that opted to take shortcuts. Dixon went on to say that they hoped the United States would approach working with innovators in a more positive way while still safeguarding consumers.
In addition, Adam Cochran, the founder of Cinneamhain Ventures, has defended Coinbase by pledging to “vote with my wallet” and become a customer if it takes legal action against the agency. Several people in the cryptocurrency world supported Coinbase, but some also used the opportunity to attack the trading site. The XRP community is among those who were upset when Coinbase removed XRP from the Coinbase Wallet last fall.