Coinbase Responds To SEC’s Wells Notice

After being served with a Wells notice by the U.S. Securities and Exchange Commission, the crypto platform released a public statement calling out the regulator for being “unreasonable.”

Coinbase Issued “Unfair” Wells Notice

On Wednesday, Coinbase responded to the SEC’s “Wells notice” with a public statement, calling out the regulator’s “unfair and unreasonable” approach towards the crypto platform and its operations. The team expresses deep disappointment, claiming it was served the “Wells notice” over an unspecified portion of its listed digital assets, its staking service Coinbase Earn, Coinbase Prime, and Coinbase Wallet. It also accuses the SEC of serving notice after the most minimal, cursory investigation.

The team wrote,

“We continue to think rulemaking and legislation are better tools for defining the law for our industry than enforcement actions. But if necessary, we welcome the opportunity for Coinbase and the broader crypto community to get clarity in court.”

What Is A Wells Notice?

For those unaware, a Wells notice is issued by the SEC staff to a company that the regulatory body has been recommended to take enforcement action against a company for possibly violating securities laws. Although it does not represent a formal charge or a lawsuit, in many cases, it can lead to one. It is basically the SEC giving a warning to a particular company that the latter is under strict scrutiny and could be taken to court.

SEC Butting Head With Coinbase

The Coinbase team reacted to the news by announcing that it would not affect their current products and services, which will continue operating as usual. They have also expressed disappointment that the Wells notice did not provide any specific information about the potential violations of securities law. The team also claims that it had proposed multiple registration options to the SEC across months, which the latter did not respond to.

The Coinbase statement also notes

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Author: Amara Khatri

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