The cryptocurrency giant pauses its staking operations in California, New Jersey, South Carolina, and Wisconsin as it continues discussions with their respective regulators.
The United States-based crypto exchange is again in the news following the fierce back-and-forth between itself and the United States’ Securities and Exchange Commission (SEC). In a blog post yesterday July 14, the exchange announced a temporary suspension of its staking operations in the four states following preliminary orders by local state regulators.
These states have laws enabling these agencies to issue preliminary orders even before legal proceedings begin.
Other Fronts In Legal Action For CoinbaseApart from the aforementioned states, the exchange is also facing legal action from regulators in Maryland, Vermont, Kentucky, Illinois, Alabama, and Washington. Unlike the previous four states however, Coinbase’s staking services are unaffected and customers “remain eligible to stake crypto just as they were before.”
These string of events comes after the SEC finally filed a lawsuit against the exchange last June 6. In the lawsuit, the agency alleged that the exchange acted as an unregistered broker, which the exchange has vehemently denied. Almost immediately, the respective regulatory bodies of the above-mentioned states initiated their own legal proceedings against Coinbase.
Coinbase however, remains unfazed by the lawsuit and the subsequent legal actions by local state regulators. It has reiterated its position that staking services are not securities and calls on the SEC to enact reasonable crypto policies instead of its current path of regulation-by-enforcement.
“It might be the easier path to simply cut off staking services in the ten states that have initiated proceedings against us, but we believe that would be wrong as a matter of law, wrong for our customers, and wrong for the future of the cryptoeconomy,” the exchange said.
After these statements, the exchange reiterated its call for the crypto community to come together for pro-crypto policies and make the U.S. a hub for crypto.
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