Coinbase, a Nasdaq-listed crypto exchange, experienced a drop in its share price of over 10% following a shocking announcement from CEO Brian Armstrong. The cause of the drop was a contentious demand from the US Securities and Exchange Commission (SEC) before their lawsuit against Coinbase. The SEC demanded that Coinbase stop trading all cryptocurrencies except for Bitcoin.
In an exclusive interview with the Financial Times, Armstrong disclosed the SEC’s unreasonable demand.
“They came back to us and said… ‘We believe every asset other than Bitcoin is a security,’ Armstrong stated. We asked how they came to that conclusion because it’s not our interpretation of the law. Surprisingly, the SEC replied, ‘We’re not going to explain it to you, you need to delist every asset other than Bitcoin’.””
SEC’s Controversial Move Against the US Crypto Industry
The SEC’s unprecedented action indicates an intention to exert regulatory control over the entire altcoin market. In its case against Coinbase, the SEC identified 13 cryptocurrencies as securities, claiming that by offering them to customers, the exchange fell under its jurisdiction.
However, the SEC’s demand that Coinbase delists over 200 tokens suggests an attempt to expand its authority over the crypto industry even further under Gary Gensler’s leadership.
Armstrong was quick to highlight the potential consequences of such a move.
“If Coinbase had complied, it could have set a precedent that would have left most American crypto businesses operating outside the law unless they registered with the commission,” he stated.
The CEO added,
“We really had no choice at that point. Delisting every asset other than Bitcoin, which is not what the law says, would have essentially meant the end of the crypto industry in the US.”
Following the announcement, Coinbase’s share price (COIN) initially fell by over 10%, dropping from $102.35 to $91.94. However, at the time of writing, the price had partially recovered and was trading at $94.76.
