The US regulator SEC is preparing to make moves towards Coinbase and Ethereum-based altcoin projects. On March 22nd, the Wells Statement was issued stating it was considering sanctions!
Wells Notice for Coinbase: These 6 altcoins are in danger
The US Securities and Exchange Commission specifically targeted several Ethereum-based altcoins in its Wells Notice to Coinbase. This notice indicates the SEC’s intent to impose sanctions.
In July, in an insider trading lawsuit against a former Coinbase employee, the SEC considered 9 altcoins securities, and 6 of these projects remain on the exchange today. The next move involves delisting these Ethereum-based altcoins.
cryptocoin.com As we reported, the 6 altcoins that were decided as securities in the insider trading case but were not delisted from the stock market were:
- Amp (AMP): 2.5% after news
- LCX (LCX): 6% down
- Power Ledger (POWR): down 2.8%
- Rally (RLY): 3.60% down
- XYO Network (XYO): down 6.71%
- DerivaDAO (DDX): down 4.41%
At the time, Coinbase vehemently denied the above claim that the cryptocurrencies were securities, citing its “rigorous” and “SEC-reviewed” process to determine which assets were listed on the exchange. Today, the SEC sent a Wells Notice to Coinbase, indicating that it is preparing to impose sanctions.
Coinbase reports that staking products are being targeted
Coinbase says the move focuses on an obscure altcoin category, as well as staking service Coinbase Earn, its institutional platform Coinbase Prime, and Coinbase Wallet:
Today, after a cursory investigation, the SEC issued a ‘Wells notice’ regarding an unidentified portion of our cryptocurrencies listed on Coinbase, our staking service Coinbase Earn, Coinbase Prime and Coinbase Wallet. We are prepared for this disappointing outcome.
We are confident in the legality of our assets and services, and we welcome a legal process, if necessary, to provide the clarity we advocate and demonstrate that it is not fair or unreasonable when it comes to the SEC. Rest assured, Coinbase products and services continue to operate as usual – today’s news does not require any changes to our existing products or services.
Coinbase said it targeted an “unidentified portion” of its reported list of cryptocurrencies, as well as the company’s staking service Coinbase Earn, its institutional arm Coinbase Prime, and the non-custodial Coinbase Wallet. The exchange says it welcomes the opportunity to defend its products in court if needed, and continues to operate as usual on all fronts.
How has the altcoin market reacted?
The news comes in the midst of a volatile day for Bitcoin and crypto markets following the Fed’s new quarter-point rate hike. The SEC also sued Tron (TRX) founder Justin Sun on the same day. Bitcoin (BTC) is trading above $27,550, down 2.7% in the last 24 hours. TRX price is down 7%.
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