You are here: Home » International » News » Markets
Business Standard

SEC threatens to sue Coinbase Global over crypto lending programme

The SEC has threatened to sue Coinbase Global Inc if the crypto exchange goes ahead with plans to launch a programme allowing users to earn interest by lending crypto assets, Coinbase said

Topics
Securities and Exchange Commission | cryptocurrency | crypto trading

Reuters  |  HONG KONG 

Coinbase
Coinbase

HONG KONG (Reuters) - The U.S. (SEC) has threatened to sue Coinbase Global Inc if the crypto exchange goes ahead with plans to launch a programme allowing users to earn interest by lending crypto assets, Coinbase said on Wednesday.

The SEC has issued Coinbase with a Wells notice, an official way it tells a company that it intends to sue the company in court, Paul Grewal, the company's chief legal officer said in a blog post. He said Coinbase would delay the launch of its 'Lend' product until at least October as a result.

Programmes that allow owners of cryptocurrencies to lend these in return for interest are becoming more common around the world, but some regulators, particularly in the United States have started to raise concerns, arguing that such products should comply with existing securities laws.

The U.S. state of New Jersey ordered the platform BlockFi Inc https://www.reuters.com/legal/transactional/new-jersey-orders-blockfi-cryptocurrency-firm-stop-offering-interest-bearing-2021-07-20 in July to stop offering interest-bearing accounts that have raised $14.7 billion from investors.

Grewal said in his blog that the SEC's concerns about Coinbase's 'Lend' were related to the fact that the regulator believed the product involved a security. Grewal said Coinbase felt that this was not the case.

The SEC did not respond to an emailed request for comment outside office hours.

 

(Reporting by Alun John in Hong Kong and Kanishka Singh in Bengaluru; Editing by Ana Nicolaci da Costa)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Wed, September 08 2021. 17:23 IST
RECOMMENDED FOR YOU
.