Thank you. We would appreciate your guidance. The “This is wrong but I won’t tell you how to do it right. Want to find out if X works? Try it and see what happens.” Approaches that are not beneficial to the industry or consumers do not work. We are not anti-regulation but we need a clear path to operate. https://t.co/KmOVkUi49r
— Jesse Powell (@jespow) February 9, 2023
Coinbase’s chief executive, Brian Armstrong, has expressed his firm’s interest in a productive relationship with the U.S. Securities and Exchange Commission (SEC). Armstrong suggested that such a relationship could help the public better understand the products and services offered by Coinbase.
During the company’s latest earnings call with shareholders, Armstrong noted that the SEC’s complaint against the alleged Kraken should bring about proper disclosure and safety measures. He claimed that Coinbase’s staking product, which is not a security, has “many differences” when compared to the product offered by Kraken. Armstrong further explained that Coinbase customers do not give up ownership of digital assets when engaging with the company’s staking product.
Staking is a process by which an individual locks their tokens in a community in order to validate transactions and receive rewards in the form of cryptocurrency. Coinbase’s staking product supports Ethereum, Solana, and Binance’s proprietary blockchain, Binance Smart Chain.
SEC chairman Gary Gensler released a video on Twitter outlining the agency’s stance on why staking-as-a-service should come with the appropriate disclosures and safeguards required by law. Armstrong confirmed that Coinbase is prepared to fight the SEC if necessary, but the company is hoping for a productive relationship. He maintained that Coinbase is within the bounds of the law given the SEC’s stance on certain assets being classified as securities.
