It is important for Coinbase Global Inc (NASDAQ:COIN) to be “aggressive” in its engagement with the U.S. Securities and Exchange Commission, as per “Dallas Mavericks” owner and “Shark Tank” host Mark Cuban.
What Happened: Cuban made his observations on Coinbase and the SEC on Twitter Wednesday.
See Also: How To Buy Coinbase (COIN) Shares
I think the SEC is trying to answer “what is a Stablecoin?” Before you can determine the rules of lending @usdc, you have to define it. By suing, @sec_news gets to play on their home court to regulate it. It could change how DeFi works,but also grow it @brian_armstrong @novogratz t.co/os1NmHJXF6
— Mark Cuban (@mcuban) September 8, 2021
The billionaire stressed that it was important for Coinbase to “be aggressive in their engagement with the SEC.”
“It's better for the industry that they take on the SEC rather than the SEC go after a small decentralized entity and get a quick [judgment] that becomes the law of the land for DeFi,” said Cuban.
Why It Matters: Cuban, who has been bullish on Dogecoin (CRYPTO: DOGE), Bitcoin (CRYPTO: BTC), and lately Ethereum (CRYPTO: ETH) told Benzinga in an exclusive interview that while DeFi yields are an obvious attraction, it will take time and integrity to “build trust” in the segment.
In a series of tweets late night Tuesday, Brain Armstrong, CEO of Coinbase decried the “sketchy” behavior of SEC.
See Also: SEC Launches Probe Into Company Behind Largest Decentralized Crypto Exchange Uniswap
As per Armstrong, SEC threatened to sue Coinbase after the company informed the regulator about the upcoming introduction of their cryptocurrency lending product dubbed “Lend.”
The lending product was due to be launched with a 4% APY on USD Coin (CRYPTO: USDC).
As per Coinbase’s Chief Legal Officer Paul Grewal, the SEC is assessing the product through Supreme Court cases called Howey and Reves, but it has not shared the assessment with the company.
The market regulator filed a lawsuit against an organization over activities related to Decentralized Finance last month.
Ripple, a company associated with the XRP (CRYPTO: XRP) token is also in a legal wrangle with the SEC after the latter alleged the firm conducted a $1.3 billion unregistered securities offering.
Price Action: On Wednesday, Coinbase shares closed 3.23% lower at $258.20 in the regular session.
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Photo: Courtesy of Gage Skidmore via Wikimedia