- Coinbase CEO Calls Out the SEC for Its ‘Sketchy’ Behavior
- The SEC is not letting Coinbase offer an existing service in the industry.
- He says that the SEC should treat all service providers equally.
The CEO and co-founder of Coinbase — Brian Armstrong, calls out the SEC for its selective suspicious behavior. Specifically, Armstrong explains in detail why the SEC is behaving sketchily over a 21-tweet thread on Twitter.
21/ Our door remains open. Hopefully the SEC steps up to create the clarity this industry deserves, without harming consumers and companies in the process. America could really use us all working together to figure this out right now.
— Brian Armstrong (@brian_armstrong) September 8, 2021
To start off, he tells his audience the situation in the form of a story. In this order, he says millions of crypto holders are earning yield from their assets for over a couple of years now. So far, it seems to be a safe bet, participants are willingly lending assets and earning returns.
Seeing as very many companies are offering the same service, Coinbase made the decision to do the same. A few weeks before going live, Coinbase gave the SEC a heads up for a briefing. Puzzlingly, the SEC’s response came with labeling this service as security.
Befuddled, Coinbase requested them to elaborate on how lending could be a security. The SEC refused and instead demanded documents and references, which Coinbase happily provided. Even after this, the regulator refused to explain their stance and instead warned Coinbase about a lawsuit if the exchange ever went live with the service.
This shows that the regulator made no effort to effectively communicate. Armstrong goes on to explain how unfair this take is. Meanwhile, Armstrong met with other much more amiable regulators.
The CEO is beside himself, he says the exchange is all for following the law but what must be done if the law is unclear? Besides, in this case, the SEC is clearly being very fishy. Why is it only Coinbase that is being troubled when other firms are offering the same service without being reprimanded?
This is where Armstrong calls out the SEC. He says, if the regulator really has no agenda on controlling who gets to offer certain services, then why not set a baseline law for all? He says the SEC should treat all similar service providers equally. So, the SEC must either let Coinbase go live with this service or begin to hinder others who have already gone live.
As a final note, he says Coinbase’s doors are open. The exchange is willing to listen to what the SEC has to say about the service being security. He finishes off the thread by saying that America will benefit if the two can work together and come to a fair resolution.