SEC is in Action After Suing Binance, Here Comes Coinbase Exchange

[Faisal2202]

As we all know that SEC has sued US Binance Exchange and its CEO (CZ). For what they have been sued is already covered (Another Fud or Its Reality? BTC is Down Again). Now as of 6th June 2023, SEC has sued Coinbase too. Why? That's what i will write here.

source

Short story, SEC always came up with the issue concerning assets declaring as (working as) Securities and SEC wants every Security to be in compliance with them. Coinbase exchange was already alleged by SEC in the past and warned too but who knows what got into SEC this week, like they are after every exchange possible. I think its pressure from the top, maybe someone advised that dealing with these centralized exchanges might control the inflation in US (again-->who knows what got into them). Now here is why they are sued for:
1.

The Coinbase Platform merges three functions that are typically
separated in traditional securities markets—those of brokers, exchanges, and clearing agencies. Yet,
Coinbase has never registered with the SEC as a broker, national securities exchange, or clearing
agency

2.

In addition, during the same period, Coinbase has operated as an unregistered broker
through two other services it has offered to investors: Coinbase Prime (“Prime”), which Coinbase
markets as a “prime broker for digital assets” that routes orders for crypto assets to the Coinbase
Platform or to third-party platforms; and Coinbase Wallet (“Wallet”), which routes orders through
third-party crypto asset trading platforms to access liquidity outside the Coinbase Platform.

3.

In addition, since 2019, Coinbase has offered and sold a crypto asset staking
program (the “Staking Program”) that allows investors to earn financial returns through Coinbase’s
managerial efforts with respect to certain blockchain protocols......Coinbase has never had
a registration statement filed or in effect with the SEC for its offers and sales of its Staking Program,
thereby depriving investors of material information about the program, undermining investors’
interests, and violating the registration provisions of the Securities Act of 1933 (“Securities Act”).

Source to above quotes


Now what impact it will make on BTC price?-->(i think not that much as of compared to Binance, yet the Coinbase market dropped 15% though but still BTC and the market facing the impact too but lesser than Binance). Who is next on the list?-->(That depends on who is against the security act). Because from that press release, one thing is sure congress has put pressure on SEC to follow the Securities Exchange Act of 1934 (source--> you can find at the first paragraph of the second page of the document). From what i think is, they are trying to make entry opportunities so that they could benefit from BTC halving (just saying, as other factors are also included though).

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[Helena Yu]

Now the Bitcoin price already hit $25K, it looks like SEC want to buy a cheap Bitcoin by suing many top popular exchanges.

I thought Coinbase already registered or regulated in US because AFAIK Coinbase is really strict and serve US territory citizens, but I've search and found if they're not registered or regulated yet.

Coinbase, Inc. is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Coinbase, Inc. is not registered or licensed with the U.S. Securities and Exchange Commission or the U.S. Commodity Futures Trading Commission.

[Yogee]

Coinbase exchange was already alleged by SEC in the past and warned too but who knows what got into SEC this week, like they are after every exchange possible. I think its pressure from the top, maybe someone advised that dealing with these centralized exchanges might control the inflation in US (again-->who knows what got into them).

I had this thought before that the US Government is trying to collect money from as many businesses as possible and the crypto industry happens to be one of the milking cows today.

Both cases filed against Binance and Coinbase will likely become another long legal battle just like the case of Ripple. We'll see who is going to run out of money from these court proceedings first hehe. Maybe we'll see a settlement within 5 years.

[KiaKia]

Now the Bitcoin price already hit $25K, it looks like SEC want to buy a cheap Bitcoin by suing many top popular exchanges.

I thought Coinbase already registered or regulated in US because AFAIK Coinbase is really strict and serve US territory citizens, but I've search and found out if they're not registered or regulated yet.

Coinbase, Inc. is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Coinbase, Inc. is not registered or licensed with the U.S. Securities and Exchange Commission or the U.S. Commodity Futures Trading Commission.

It's going to be people's fault if Bitcoin goes lower because of this news, I know it's a fact and not a FUD but it shouldn't affect the market much, oh yes, I forget that every humans have different reactions, we are the reason why some news affects the market condition anyway.

I believe this is a good opportunity to buy some Bitcoin right now but if a bigger manipulation is already in play then this go even more bloodier in the coming days, I do hope not because it was a big fight for Bitcoin to get to 25k to 27k range in past months.

I still don't know why many people rely and trust centralized crypto exchanges more than having their bitcoin in their custodial wallets, a small bad news here and there, everyone is rushing to move their assets out of the exchange, it's a shame.

[Doan9269]

What else do you expect if they cannot target bitcoin because of its decentralization then they will be left with nothing than to go after the centralized exchanges, this should only serve a warning for some of us still using them, we shouldn't hodl our entire investment in them, they have in custody our private keys to unlock the locked coins in the blockchain which belongs to us, this time we should be getting ready for higher transaction fees coming from this exchanges for those that uses them because they will be left with no option than to fall back on their users.

[bittraffic]

Gensler go crazy again. But he will fail in supressing Bitcoin, he knows he is in a losing battle that price is not going zero after he had been doing this for a long time.

He was asked in a hearing just this year which tokens he identifies security but could not answer it directly. That hearing itself will be used against SEC.

[pawel7777]

You cannot not feel sorry for Coinbase. As far as I know they tried really hard to be compliant, even tried to get a court to force SEC to give a clear answer on what is and isn't a security, but all they get is a lawsuit against them.

Binance also get hit with massive funds outflow from its US business of $1.4bn since the lawsuit. I'm sure they survive though, but will struggle to return to the same levels.
https://www.reuters.com/technology/bitcoin-steadies-above-25000-binance-sec-lawsuit-rattles-investors-2023-06-06/

[Captain Corporate]

Lets be honest here, this isn't the "attack" we think it is, its as normal as it gets and there is nothing wrong with it. I know that plenty of people who are defensive about crypto, we love it and that's why we do not want anyone to touch it, I get it. However, we need to realize that there is nothing wrong with SEC looking into Binance, that's their job and they are paid to do exactly that. If Binance is doing nothing wrong, then there will be nothing bad coming out of this, if they are doing something wrong then they will be caught and according to their crime they will be given a penalty, some sort of fee. Just a few years ago USDT had the same thing, paid like 19 million or something. This is their job and we shouldn't be shocked about anything regarding this at all.

[bettercrypto]

In the past few months, I have noticed that what the SEC in the U.S is doing is harassing crypto exchanges, because they can't control them so they are taking advantage to make a way that the value of Bitcoin is decreasing in the market .

Because they know they have influence, they are doing this as a way to maybe buy a lot of Bitcoin which they probably know that in the upcoming halving, its price will increase for sure. One day Binance was replaced by Sec, now coinbase is. Maybe the crypto exchanges that are in the U.S. are better now, it's better to just move to another country that is friendly to cryptocurrency.

[dothebeats]

How often do lawsuits like this materials into a full-blown closure of exchanges? Binance, out of all the existing exchanges today, seem to be the most experienced when it comes to legal pressure like this. It's like CZ has been brushing off all those lawsuits and all those pressures mounted onto him and his platform, and I'm sure he'll end up just paying some fines and fixing whatever there is to fix as mandated by the SEC.

As for the price experiencing a sudden turn for the worse, it's just a lot of shaky hands getting moved by the recent news. As always, there'd be nothing major that will come out of this for sure, as what had always happened before.

[AmoreJaz]

How often do lawsuits like this materials into a full-blown closure of exchanges? Binance, out of all the existing exchanges today, seem to be the most experienced when it comes to legal pressure like this. It's like CZ has been brushing off all those lawsuits and all those pressures mounted onto him and his platform, and I'm sure he'll end up just paying some fines and fixing whatever there is to fix as mandated by the SEC.

As for the price experiencing a sudden turn for the worse, it's just a lot of shaky hands getting moved by the recent news. As always, there'd be nothing major that will come out of this for sure, as what had always happened before.

CZ won't be successful in this business if he doesn't know what he's doing. for sure, there will be his lawyers and other staffs that are already working on this even before the lawsuit came into the light.
i am also on the side that they will probably just pay some fines but not to the extent of heading to bankruptcy, they have all the resources to rectify what they are in.

[adaseb]

Most likely tomorrow or by the end of the week they will be suing Kraken, Cryptodotcom, Gemini and any other US based crypto exchange which lists those dozens of tokens which they consider securities.

Seem right now only the POW coins are safe and ETH. But any coins or tokens which had any type of ico then it’s considered a security which pretty much is most tokens these exchanges have listed. Nothing looking good. Most likely all these exchanges will stop providing services to US customers due to this.

[Velemir Sava]

We know the SEC's primary role is to regulate the securities markets in the United States, ensuring investor protection, market integrity, and capital formation. I am also a consumer and a user. What is this, who will protect us, other users or investors, SEC or exchange platforms? if it continues like this when will Crypro World progress. Because, the ones affected by the location are users and investors.

[killerfrost]

After the news came out and looking at how BTC reacted to it I also have my own thoughts on this matter, the suppression of BTC through the names really affects in this context as well. should be mentioned, why this stage? And if they knew about the issues involved and did everything sooner, if they didn't want to imagine the problem of price manipulation with FUD, it's still on my mind as well. However, the fact that people like me put great faith in this market and believe in the future of BTC will become more and more popular and strong, this is only considered as part of the development journey of the market.

[Husires]

I created this topic two months ago {list} Crypto exchanges under SEC’s Radar!, and there are 5 platforms that have been subjected to sanctions in one way or another from the SEC. This was only during first 4 months, and therefore I do not expect to be surprised by such lawsuits.

Therefore, with the activity that the office undertakes, I expect that more than 90% of the platforms will escape from the United States during this year, and perhaps one or two platforms will remain operating. These platforms will be under the eyes of regulatory control and thus less possibility of escaping as fraud.

From now and in the future, the "staking program" will not be allowed in most of these platforms, and we may not see stablecoins or exchange coins like BNB, and restrictions may be placed on listing and futures trading.

[348Judah]

We know the SEC's primary role is to regulate the securities markets in the United States, ensuring investor protection, market integrity, and capital formation.

How far has all these regulations gone in dealing with financial attrocitise from using fiat even before the introduction of cryptocurrency, crime and financial misconducts is very common and has always been ever increasing in the traditional economy and the government officials were not left out in having their own roles played that have led to these increase, why the attacks on exchanges when they are nothing different from the banks itself.

I am also a consumer and a user. What is this, who will protect us, other users or investors, SEC or exchange platforms? if it continues like this when will Crypro World progress. Because, the ones affected by the location are users and investors.

No one will protect you than you protecting yourself, isn't it not because of the failure in the trust we had with government and financial institutions the main reason that birth to the Satoshi Nakamoto development of a new monetary system in a decentralized way, that gives us our Freedom back from what had been taken for so long, that control is what you have over your financial assets or investment if you adopt bitcoin and make use of this p2p network in a decentralized way.

[flyingcarpet]

I don't think it will have a huge impact compared to the Binance situation. Even after the Binance news, there was no big drop. This is actually good news because bitcoin is an independent asset from exchanges. Of course bitcoin can be affected by this news, but it hasn't had such a big impact. This shows that bitcoin has a solid position in the market. From another point of view, I think the SEC is aiming to buy bitcoin on the cheap? What is this succession of news? People don't sell their bitcoins anymore after this kind of news. I think they don't know that.

[slapper]

We are in an era where behemoths of the crypto world, Binance and Coinbase, are under the SEC's radar, triggering some compelling riddles around the agency's game plan and endgame. With an affinity for a sturdy crypto ecosystem, I'd love to drop some thoughts on the matter.

Nothing shocking in the SEC's push for registration and adherence to the rules – it’s their job, after all. However, the intensity of this charge could signal a play for power over a realm that's been given a lot of leeway so far. Maybe it's a reaction to the undeniable rising popularity of digital coins, a tactical move to lower the risks that could be hitching a ride on this trend.

When it comes to the effect on Bitcoin's price, I'm not sold. Sure, the immediate aftermath may just be a blip, but we cannot overlook what might unfold in the distance. The mere whisper of regulation can send ripples of uncertainty through the market, possibly throwing investor feelings off balance.

If I were to predict, I'd say we might witness a more aggressive tilt towards decentralized exchanges (DEXs) to sidestep these regulatory hurdles. But before we all cheer, remember that it isn't all sunshine and rainbows – it has its own hurdles. For now, it's watch, wait, and wonder in the crypto universe.

[retreat]

They really don't let the CEOs of these exchanges live in peace, there must be something that they think is wrong with the operations of these exchanges and they must immediately submit to them. Even Coinbase is not exempt from this attack and I think that other exchanges operating in America will also be hit by them. I can't understand why these boomers are so passionate about attacking exchanges. Okay, regulation is needed, but does it have to be this strict? don't they think that the impact of their attacks also affects the crypto assets of Americans? they should regulate these exchanges but still have little tolerance because the impact of their decisions caused billions of dollars of losses in the crypto market.

[Etranger]

It seems to me that all these lawsuits and attacks on binance and other exchanges only attract even more attention to the cryptosphere, from which the latter can even benefit. I think the goal here is not the result, but the process itself. On the one hand, SEC is trying to show that no one is protected from its gaze, and binance demonstrates its resilience and ability to fight in such a battle. It is still unclear who really benefits from this whole story