The U.S. Securities and Exchange Commission filed a complaint against Coinbase (COIN), and the price of the tokens mentioned in it is currently in freefall.
The SEC charged Coinbase with violating federal securities laws just one day after bringing a comparable action against Binance.
The exchange’s stock decreased 20% in pre-market trading.
Filecoin (FIL), Sandbox (SAND), Polygon (MATIC), Solana (SOL), Cardano (ADA),
The tokens mentioned in the case are Axie Infinity (AXS), Chiliz (CHZ), Internet Computer (ICP), Voyager Token (VGX), NEAR protocol (NEAR), NEXO, FLOW, and DASH.
The biggest cryptocurrency exchange in the nation, Coinbase, was sued on Tuesday by the Securities and Exchange Commission, which claimed that the company had broken securities rules by neglecting to register as a broker.
A day after Binance, the biggest cryptocurrency trading exchange in the world, was accused of improperly handling user money, the complaint was filed.
as well as deceiving American regulators and investors about its business operations.
The defendants Coinbase, Inc. and Coinbase Global, Inc. should also be “permanently restrained and enjoined” and forbidden from conducting business in the United States, according to the SEC.
Businesses that deal in cryptocurrencies have battled classification of their products as traditional securities or commodities for a long time, arguing that they represent a brand-new class of digital assets with their own set of rules and regulations.
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Contrary to popular belief, the SEC maintains that the majority of cryptocurrency offers are securities and as such should be governed by the same laws as Wall Street stocks and bonds.
By sparking legal action and, ultimately, court scrutiny, the legal actions brought against two of the biggest names in cryptocurrencies may persuade Congress to take action on the regulation issue.
Changpeng Zhao, the CEO of Binance, made fun of the SEC in response to the Coinbase case.