SEC sues Coinbase as feds crack down on cryptocurrency companies
CBSN
The Securities and Exchange Commission on Tuesday sued Coinbase, alleging that the publicly traded cryptocurrency trading platform has been operating illegally as an unregistered exchange.
The litigation comes one day after the SEC filed suit another major crypto exchange, Binance and its CEO, on grounds that it too is violating securities rules by not registering with the SEC. The pair of suits are part of SEC Chair Gary Gensler's push to regulate the burgeoning cryptocurrency market and protect investors.
"We allege that Coinbase, despite being subject to the securities laws, commingled and unlawfully offered exchange, broker-dealer, and clearinghouse functions," Gensler said in a statement Tuesday. "Coinbase's alleged failures deprive investors of critical protections, including rulebooks that prevent fraud and manipulation, proper disclosure, safeguards against conflicts of interest, and routine inspection by the SEC."