BREAKING: SEC SUES Coinbase—Should You Move Your Funds?

The SEC has gone on the offense and seems to be pursuing a scorched earth policy. …

A mere one day after filing a lawsuit against the world’s most popular centralized crypto exchange, Binance, the agency is now targeting Coinbase.

Regulators from the SEC filed a lawsuit against Coinbase on Tuesday, alleging that the crypto giant was acting as an unregistered securities broker, among other charges.

This recent and unprovoked move has many investors spooked, as many clients and customers of the platform scramble to move their funds off the platform.

The Securities and Exchange Commission announced on Tuesday:

Today we charged Coinbase, Inc. with operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency and for failing to register the offer and sale of its crypto asset staking-as-a-service program.https://t.co/XPG2gDkxtV pic.twitter.com/hCdVMw8B2v

— U.S. Securities and Exchange Commission (@SECGov) June 6, 2023

Watcher.Guru provided this update on the price action of COIN—Coinbase’s stock. The popular financial news outlet reported a 17% drop in Coinbase’s share price.

JUST IN: Coinbase $COIN sinks 17% following SEC lawsuit. pic.twitter.com/dii0vlgGDY

— Watcher.Guru (@WatcherGuru) June 6, 2023

JUST IN: 🇺🇸 SEC says #Coinbase made "billions of dollars unlawfully facilitating the buying and selling of crypto asset securities."

— Watcher.Guru (@WatcherGuru) June 6, 2023

Finbold reports:

Similar to the Binance lawsuit, the securities regulator alleges that Coinbase violated US securities laws.

Notably, the SEC charged Coinbase with operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency, in addition to failing to register the offer and sale of its crypto asset staking-as-a-service program.

The crypto community was quick to fire back at Gary Gensler and the Securities and Exchange Commission, pointing out the obvious hypocrisy of the government agency.

You are corrupt and have no allegiance to the law. The SEC greenlighted Coinbase's IPO. Why didnt you sue FTX after meeting with SBF multiple times?? pic.twitter.com/aEwSOSyM14

— Tony Edward (Thinking Crypto Podcast) (@ThinkingCrypto1) June 6, 2023

2021: #SEC approves Coinbase IPO

2023: SEC SUES #Coinbase, stating that basically everything they do is unregistered. pic.twitter.com/KiqFsmh7G0

— DustyBC Crypto (@TheDustyBC) June 6, 2023

Blockworks adds:

In the complaint, the SEC states that 13 crypto assets are “securities” including SOL, ADA, MATIC, FIL, SAND, AXS, CHZ, FLOW, ICP, NEAR, VGX, DASH and NEXO.

While there is some overlap between the allegations against Coinbase and those against Binance, some of these assets are newly-designated as securities by the SEC.

It is unclear if the SEC has reached out to, or discussed, these designations with the token issuers.

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