Crypto exchange Coinbase is refuting claims by the U.S. Securities and Exchange Commission (SEC) that nine digital assets listed on its platform are securities.
Coinbase’s chief legal officer, Paul Grewal, says the exchange rejects the SEC’s claim that nine of its listed digital assets are securities in its complaint against one former employee and two other individuals accused of insider trading.
According to Grewal, Coinbase conducts a rigorous review process before listing digital assets to ensure that securities are kept off the platform.
“We 100% disagree with the SEC’s assertion that any of the crypto assets we list are securities.
Coinbase has a rigorous process to analyze and review each digital asset before making it available on our exchange – a process that the SEC itself has reviewed.”
Coinbase’s top lawyer says that despite the U.S. Department of Justice (DOJ) and the SEC looking at the same evidence, only the latter views the crypto assets involved in the insider trading case as securities.
“We have cooperated with both the DOJ and the SEC on this investigation. The DOJ reviewed the same facts and chose not to file securities fraud charges against those involved.”
In its insider trading case, the SEC’s complaint states that the agency believes nine Ethereum-based tokens listed on the exchange are securities. The agency points to Amp (AMP), Rally (RLY), PowerLedger (POWR), XYO Network (XYO), Rari Governance Token (RGT), LCX (LCX), DerivaDAO (DDX), DFX Finance (DFX) and Kromatika (KROM).
“…each of the nine companies that offered these crypto asset securities and their promoters further emphasized, among other things, their efforts to get their crypto asset securities listed on secondary trading platforms, and the critical role that executives and others at the company played in turning the company into a success, thereby increasing the value of the crypto asset security.
In other words, each of the nine companies invited people to invest on the promise that it would expend future efforts to improve the value of their investment.
These hallmarks of the definition of a security continue to be true for the nine crypto asset securities that are the subject of the trading in this complaint, including continuing representations by issuers and their management teams regarding the investment value of the tokens, the managerial efforts that contribute to the tokens’ value, and the availability of secondary markets for trading the tokens.”
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The post Coinbase Rejects SEC’s Claim That Nine Ethereum-Based Altcoins Are Securities appeared first on The Daily Hodl.
