🐻 Coinbase goes to war with the SEC
Plus, Binance walks away from Voyager deal
GM friends, the great bank collapse continues with First Republic Bank slated as the next to go under. Upon news that First Republic customers withdrew over $100 billion worth of deposits in the first quarter, the $FRC stock quickly slumped down to now -93% YTD. You know what’s back up and never stops trading? Crypto 😎.
#Bitcoin vs. First Republic Bank.
banks go down, BTC goes up
— K A L E O (@CryptoKaleo)
Apr 26, 2023
In this issue
📣The big story of the week. Coinbase goes to war with the SEC.
🗞️In other news. Uniswap surpasses $1.5 trillion in trading volume, Binance walks away from the Voyager acquisition deal and Do Kwon rejects the SEC charges against him.
📣The big story of the week
Coinbase goes to war with the SEC
Last issue we talked about the growing trend of US crypto companies moving out of the country to more crypto-friendly nations. Coinbase and Gemini have already dropped hints and even begun taking steps toward the move.
Now, crypto companies are clapping back at the SEC and calling them out for beating around the bush. It’s like asking someone what they want to eat for dinner, but won’t give a straight answer 🤦♀️ .
Just 👏 tell 👏 us 👏 what 👏 you 👏want.
Well, Coinbase is getting sick of the games. So sick of it that they’re suing the SEC.
Today, we filed a narrow action in the U.S. Circuit Court to compel the SEC to respond “yes or no” to a rulemaking petition we filed with them last July asking them to provide regulatory guidance for the crypto industry. 1/4
— paulgrewal.eth (@iampaulgrewal)
Apr 25, 2023
Here’s what happened. Back in July, Coinbase sent the SEC a “petition of rulemaking”, which under law, requires the SEC to respond within a reasonable time. A few months later and with no response, Coinbase has now asked the Federal Court to force the SEC to answer and provide clarity on existing securities laws for crypto.
$COIN just formally requested the SEC to provide regulatory clarity (left)
Gensler: there's no lack of clarity, just lack of compliance (right), per Bittrex lawsuit PR
They're further aggravating the SEC. Desperately grasping at straws. I think the timeline just sped up. twitter.com/i/web/status/1…
— Logical Thesis (@LogicalThesis)
Apr 25, 2023
Why does it matter? Last month, the SEC issued Coinbase a Wells Notice, which is basically a heads up that they may be taking legal action against the crypto exchange for its staking service and allegedly listing unregistered securities. If the SEC succeeds, Coinbase would have to shut down certain crypto services, just like they did with Kraken exchange.
So Coinbase played a reverse UNO card and gave the SEC back what they served 💥. They also posted this video response to the SEC’s Wells Notice.
1/ Today we’re sharing our “Wells response” to the SEC. As part of our response, @iampaulgrewal and I sat down to explain why we’re confident in the facts and on the law, and why a Wells notice is not in the best interest of the US.
— Brian Armstrong 🛡️ (@brian_armstrong)
Apr 27, 2023
Tl;dr Coinbase is not backing down 💪. Instead, they’re lawyering up and getting ready to put up a fight, but things could turn ugly real fast. The more aggressive Coinbase gets, the more aggressive the SEC will also likely be in return, which might not be a good thing.
I guarantee you Gensler is now putting all the top SEC attorneys on this case
The more public $COIN makes this, the more painful it will be
— Edwin Dorsey (@StockJabber)
Apr 27, 2023
Generally though, we think it’s good to see a major crypto player standing up against the SEC while most of the crypto industry sits on the sidelines. But we also wonder…what’s really happening in the bigger picture 👀?
Brian Armstrong has made an interesting chess move.
> call out the SEC
> now they may be forced to act, or respond at least.
You should be asking how this move could benefit CB.
> SEC restricts staking to compliant co’s only (?)
Billionaire CEO’s don’t just rant… https://ttwitter.com/i/web/status/1…
— CryptoCapo.eth 🪞 (@CancelledPapi)
Feb 8, 2023
🗞️ In other news
🦄 Decentralized exchange Uniswap passes $1.5 trillion in trading volume. Bullish! The world’s largest DEX continues to grow at a time when banks are collapsing and centralized exchanges are getting hit with regulatory scrutiny.
🚶♂️Binance is walking away from the $1 billion Voyager deal. Right after Binance received approval from the bankruptcy court Judge to proceed with the acquisition of Voyager, the crypto exchange decided to walk away from the deal. Why? Because of the ‘hostile regulatory uncertainty’. Looks like the pressure finally got to Binance after the US regulators made it clear that they didn’t support the acquisition in the first place.
🛑 Do Kwon rejects the SEC charges ruling LUNA as a security. After wiping out over $40 billion of investor’s wealth in the collapse of Terra LUNA and UST, Do Kwon has now filed a motion to dismiss the SEC charges against him. According to the SEC, stablecoin UST and token LUNA were unregistered securities, but Kwon argues that the case relies on outdated and unclear regulations. He is currently held in custody in Montenegro where he faces extradition.