I want to tell you about the market closure that is making its way through crypto and make sure that we provide some context because this is not the end of cryptocurrency, but there are some important things that we can do right now to make sure that we are safe now.
As you can see, the whole crypto market is down today by about 2.5 percent, really just due to the FED and not to what’s happening right now after the market closed. This hasn’t really had that much of an effect on the market, but honestly. We’re down so much.
Here today, I think it’s normal for us not to sell off even more on this news, because we were already sort of expecting it. Now what am I talking about? Well, Brian Armstrong just posted today that Coinbase received a Wells notice from the SEC, focused on staking and asset listings.
Wells’ notice generally precedes any enforcement action; notes that two years ago the SEC reviewed our activities to release an approved coin base; Our S1 clearly explained our asset pricing process and included 57 references to staking Coinbase went through a rigorous asset review process and rejected over 90 incoming assets that asked to be listed on the platform.
We understand that this is part of the journey to reforming our financial system; we are right on the law, confident in the facts, and welcome the opportunity for coinbase and more broadly, the broader cryptocurrency community is judged.
We are proud to stand up for our customers and the industry in these moments, and going forward, the legal process will provide an open and public forum before an unbiased body. Where we will be able to make it clear for all to see that the SEC has not been fair, reasonable, or even demonstrated a seriousness of purpose when it comes to its engagement on digital assets, in the meantime, Coinbase will continue to do what we do best to build the most trusted products and services in order to advance our purpose of updating the financial system and creating more economic freedom in the world,
We’re excited to go through and continue to work with governments and regulators around the world who are focused on putting clear guidelines in place to regulate the crypto industry, and this is coming from the legal officer and is giving a little bit more detail.
Now, this basically means that they will probably get sued by the SEC. Wells notice precedes the what they say here the enforcement action we’ve seen this in the past crypto firm paxos facesSEC lawsuit over busd and they issued a Wells notice to paxo.
So that basically shut down the BUSD token, killed one of the top 10 cryptos Kraken recently, got, I believe, a wellness as well if not, it was just that they had to basically pay a huge fine, a 30 million dollar fine, and they had to get rid of their crypto staking.
Now at the time Brian Armstrong posted that they’re hearing rumors of the that the SEC is going to get rid of crypto staking in the US for retail customers and he says in this or another post that, they are willing to fight this in court, they’re not giving up their staking business, this is a big money maker for them and will continue to be the funny thing is too larger banks have talked about crypto staking and how big an opportunity that is as well.
Now I think, it is important to keep in mind that just because, they’re getting sued or they might get sued, it doesn’t mean that they’re, they’ve lost the case right recently we’ve been hearing about the judge scrutinizing the SEC over the denial of the grayscale Bitcoin ETF and they were really giving the SEC.
It’s a hard time basically saying, “Hey, you’re the reasoning behind not approving this is invalid,” as it sounds, because basically they’re saying, “Hey, we don’t want a spot ETF because that can be easily manipulated.”
However, you can do the same thing if it’s not spot because it moves up and down with bitcoin’s price. Anyways, so that lawsuit, you know, maybe will finish soon, who knows? It could go on for a very long time as we’ve seen with the XRP lawsuit, but XRP seems to be going in a better direction as well, at least that’s what the price would say; XRP was up 26 percent in a day.
Now it’s down 8.8 percent but, honestly, after that big a move it makes sense, so, up a lot over the last week, and some people are saying that they’re trying to get a hold of the documents where it was shown that ethereum is actually not a security but, instead, a commodity, and you know, the SEC is trying to be very tight with that information out trying to give it out.
The question is, why, unless they made some ruling and said that, ethereum’s a commodity for some reason like, maybe you can use it to pay network fees or something like that, and they realise well, a lot of cryptocurrencies would then be commodities.
So, maybe this is going to blow up in Sec’s face as well soon, so either way, I don’t think we need to panic. Being said, coinbase stock last time I heard was down a lot, basically, on this news that they might be getting sued here soon and this could be a big drain on their money.
Personally, I think Coinbase is probably going to be fine, but if I had crypto on Coinbase, I’d probably move it off if I felt comfortable with a hardware wallet, which I think everyone in crypto really should get used to using a hardware wallet and maybe a hot wallet as well. I think it makes a lot of sense to take it off. That way, you can actually hold the keys to your own crypto, even if you’re living in the US and have to abide by regulation.
Here you have more freedom; if you have your crypto in your own wallet and you can move it to your own websites, you can use exchanges, and you know it’s not only cheaper and safer, but you’re just outside of the US’s view a little bit more. So, while I think Coinbase is going to be fine, and I’m not trying to cause a bank run on their assets or anything like that, I don’t really see any benefit to keeping it there.