Coinbase shares sink and Bitcoin price falls after US regulator’s crypto crackdown
US regulators are suing Coinbase, one of the world’s leading crypto brokers and exchanges, just a day after announcing action against fellow crypto giant Binance.
The filing by the US Securities and Exchange Commission (SEC) in a Manhattan court accuses Coinbase of operating as an unlicensed broker since 2019.
Per a Reuters report, the SEC claims Coinbase has ‘deprived investors of disclosures and protections that come from registration, exposing them to significant risk.’
The SEC also says Coinbase’s staking program is, in effect, a security.
The bombshell filing comes a day after the SEC sued crypto giant Binance for ‘mishandling’ billions of dollars and accused the company of a “web of deception.”
The double whammy reflects an increased focus on the crypto market by regulators across the world.
Coinbase is so far yet to comment.
“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,” SEC Chair Gary Gensler said in a tweet.
The firm’s shares sank 15 per cent in pre-trading.
The price of Bitcoin, a bellwether for the cryptocurrency market more generally, also fell by more than a percentage point.
This is a developing story and will be updated