Coinbase Slams SEC For Unfair & Unreasonable Wells Notice

• Coinbase has released a public statement in response to the Wells notice issued by the U.S. Securities and Exchange Commission, calling it “unfair and unreasonable”.
• The Wells notice is a warning issued by the SEC staff to companies that may have violated securities laws.
• In their statement, Coinbase expressed disappointment with the SEC’s minimal investigation and lack of clarification over alleged violations.

What Is A Wells Notice?

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

Coinbase Responds To “Unfair” Wells Notice

On Wednesday, Coinbase responded to the SEC’s “Wells notice” with a public statement, calling out its “unfair and unreasonable” approach towards the crypto platform and its operations. The team expressed 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. They also accused the SEC of serving notice after only minimal investigation into these matters.

SEC Butting Heads With Coinbase

Coinbase has announced that this news will 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 potential violations of securities law or identity which assets were considered in violation of such laws. The team claims they had proposed multiple registration options across months which were never responded to by regulators nor was further clarification given beyond identifying some securities violations on their platform.

Judges Against SEC

The statement also includes a quote from Federal Bankruptcy Judge Michael Wiles who called out regulators over an ongoing Voyager case saying “Regulators themselves cannot seem to agree as to whether cryptocurrencies are commodities that may be subject t regulation.”


Coinbase has argued against taking enforcement action against them due to lack of clarity on what specifically constitutes securities law violations on their platform while judges have called out regulators for not being able to agree on how cryptocurrencies should be regulated moving forward

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