Following Ripple’s intention to sue the US Securities and Exchange Commission, Coinbase has joined the “resistance forces.” However, it is still uncertain which side would come out on top in this battle.
Coinbase CEO Brian Armstrong warned in a tweet on September 8 that the SEC might take legal action if the exchange offers to Lend cryptocurrency savings accounts based on the USDC stablecoin, which will pay users 4% per year. The reason for this was because the SEC suspected the financial product of including unregistered securities.
A response from Ripple CEO Brad Garlinghouse came an hour after Armstrong’s tweet. “Welcome to the party, buddy,” he said to one of his coworkers. But, of course, all of this was an irony given one of the industry’s least enjoyable events: lengthy litigation between the US Securities and Exchange Commission and the crypto company Ripple that has been ongoing for almost a year. A claim against Ripple, which allegedly dealt in unregistered securities for seven years, triggered the event. Mark Cuban, the billionaire, and Jesse Powell, the Kraken crypto exchange CEO, agreed that going “on the attack” against the SEC was a good idea.
In reply, Armstrong accused the SEC of using “intimidation behind closed doors” techniques and suggested that the US Securities and Exchange Commission’s officials pay more attention to the whole cryptocurrency sector. He was most likely referring to the department’s total indifference for hundreds of scam projects in the field of decentralized finance and other blatant scams going place right in front of its eyes while focusing most of its attention on the work of legitimate businesses.
Uniswap, one of the largest and most transparent DEXs, caught the SEC’s attention in addition to Ripple and Coinbase. Her team has stated that they are willing to work with the commission, but the rest of the crypto world is still baffled as to why there is such a strong interest in DEX and suspicions of unregistered securities trading. Some quipped that the SEC had “one diagnosis for everyone when it comes to digital currencies.”
Even more depressing is that not long ago, everyone was ecstatic with the advent of Gary Gensler, a new chairman who was interested in bringing the crypto sector and American justice together. However, there have been no obvious effects of this “synergy” to date. One of the reasons for this, according to analysts, might be pressure on Gensler from the highest levels of government, including the White House and the US Treasury, which see cryptocurrencies as a direct danger to the US currency.
Large crypto companies are adamant about protecting their ability to operate in court in some fashion, and their next moves might be pivotal for the industry’s future. For example, suppose Coinbase can secure the backing of important industry heavyweights such as Powell, Cuban, Garlinghouse, and others. In that case, the SEC will almost certainly be forced to back down. Or, at the absolute least, be ready to back up your worries about unregistered securities trading with something more permanent than “investor protection.”