Cryptocurrency exchange Coinbase’s stock fell by as much as 21 percent at times on Tuesday.
The US Securities and Exchange Commission previously announced that it had sued the company.
Coinbase offered for trading crypto assets that the SEC classifies as securities and should have been registered by the company as such, the lawsuit alleges.
Crypto exchange Coinbase’s stock plummeted as much as 21 percent on Tuesday after the US Securities and Exchange Commission (SEC) filed a lawsuit against the company. Coinbase offered for trading crypto assets that the SEC classifies as securities and which the company should have registered as such, according to the lawsuit filed in court in New York on Tuesday. Coinbase operates an illegal U.S. securities trading exchange while also performing certain other financial services without the necessary licenses, according to the SEC. The company initially did not comment.
The day before, the SEC had sued the world‘s largest crypto exchange, Binance. SEC boss Gary Gensler accused Binance and company founder and boss Changpeng Zhao of deception, conflicts of interest, disclosure failures and calculated evasion of the law. For example, investors were misled about risk controls and trading volumes.
Crypto exchanges are under pressure
With the lawsuit against Coinbase, the authority is now further tightening its pace. “Coinbase’s failures are depriving investors of key protections, including anti-fraud and anti-tampering frameworks, proper disclosure, conflict of interest protections, and routine SEC inspections,” Gensler said.
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Coinbase has been under investigation by the SEC for months and received a filing from the agency in March indicating that enforcement action was imminent. Meanwhile, there was also at cryptocurrencies How Bitcoin and ether a sell-off. The price of Bitcoin fell by around three percent in one day.
With material from the dpa. This article was translated from English by Klemens Handke. You can find the original here.