Cryptocurrency exchange Coinbase said on Thursday that the U.S. Securities and Exchange Commission (SEC) had made a "flip-off" ruling on the alleged legal violations.
Coinbase CEO and Chief Legal Officer Releases a Video
Coinbase CEO Brian Armstrong has warned the Securities and Exchange Commission (SEC) that any possible enforcement action against the exchange is "not in America's interest" and said the company is ready to defend itself in court.
The SEC recently issued an official notification to Coinbase that the company is under investigation for its Earn product, wallet service, and exchange activity. The Commission had issued a Wells Statement, a document that could be applied to the embattled stock market prior to enforcement action.
"A Wells Statement at this stage is not constructive and not good for America in the absence of a clear rulebook," Armstrong said in a new video released with Chief Legal Officer Paul Grewal.
“We are ready to defend this stance in court. But it doesn't have to get to that point. We welcome genuine dialogue about a viable path forward for our industry.”
Coinbase's lawyers were more candid in their official 73-page response to the SEC investigation Thursday afternoon.
"The Commission's lawsuit against Coinbase will fail in terms of facts and law," attorneys for Sullivan & Cromwell, representing Coinbase, wrote in the dossier.
In the video, Grewal said that the Wells Statement meant that SEC officials had "reached a preliminary determination that their company's core business is violating securities laws."
“I want to be very clear with you: Coinbase does not list securities. We use a robust process based on SEC guidance to ensure we do not list securities.”
*Not investment advice.