- Berenberg says that SEC is yet to file an enforcement action against Coinbase.
- Berenberg’s analyst reported that the SEC targets revenue sources.
In a recent report of Berenberg Capital Markets, it is said that the U.S. Securities and Exchange Commission (U.S. SEC) is still against Coinbase, a cryptocurrency exchange platform. Thereby, the report added that the SEC would raise an enforcement action anytime sooner followed by the Wells Notice.
The @SECGov will soon bring enforcement action against @coinbase.
— CoinDesk (@CoinDesk) May 16, 2023
The action is likely to mirror those that the regulator brought against rival crypto exchanges @BittrexExchange and @krakenfx, Berenberg said in a research report on Monday.https://t.co/z5Uxcnmaqm pic.twitter.com/VtgcYFO68X
It is believed to be resembling actions taken for Bittrex and Kraken among the communities. The criticality relies upon the revenue that is been generated by Coinbase.
What does Berenberg’s report say?
One of the Berenberg analysts named Mark Palmer spotlighted in the report said that the SEC might target the revenue sources. This would profoundly be filling an enforcement action in the coming days.
Moreover, Coinbase generated total revenue of around $736M in the Q1 of 2023. Out of which, 37% has been extracted from the transaction fees and also staking service fees. Meanwhile, Palmer added that Coinbase’s stock crossed its target of over $55 and was suspended at $57.88 this Tuesday.
With this, Palmer condemned that tokens other than Bitcoin are termed to be unregistered as SEC says. However, any trading platform of such tokens would preferably get an enforcement action led by SEC with respect to the U.S. government.
Coinbase vs SEC
The Chief Legal Officer of Coinbase, Paul Grewal replied to the SEC’s denial of the petition saying that the SEC should focus on fixing their rulemaking in the crypto industry. He also said that the formal response would be sent within a week from Coinbase. For this, SEC’s lawyer named James Murphy preferred its argument saying:
“It’s fully within its rights to wait years (literally) to decide whether to grant the petition” and that “it intends to keep right on suing crypto companies without any new rules.”
Furthermore, the SEC continues this slow denial of Coinbase’s petition. Murphy elaborated that the commission purely makes it possible to get away with this delay tactic.
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