The United States Securities and Exchange Commission (SEC) has threatened to drag U.S. cryptocurrency exchange platform Coinbase to court if it goes ahead with its plan to launch a high yield crypto product called Lend.
In June, Coinbase announced plans to launch Lend, which would allow stablecoin owners to earn a 4% interest on their USDC savings.
The CEO of Coinbase, Brian Armstrong, who is not pleased with the new development, took to Twitter to pour his mind on the matter, accusing the SEC of “engaging in intimidation tactics behind closed doors.”
According to Armstrong, Coinbase had already “reached out to the SEC to give them a friendly heads up and briefing” about the product, but to their surprise, the SEC said the product is a security.
In the last 24 hours, bitcoin is down by 9.05%, with a current price of $46,389.28 as at the time of writing this. Within 24 hours, bitcoin dropped to $42,921.27 low and $51,066.09 high. The trading volume of bitcoin in the last 24 hours is $3.27M. The current market capitalization of bitcoin is $872.56. Currently, $18.81M bitcoins is in circulation.
Stats and Image from Coin Desk
Armstrong said the SEC “tell us they will be suing us if we proceed to launch, with zero explanation as to why.”
In his statement, he suggested that the U.S. regulator might be targeting Coinbase since other crypto companies are offering the same product.
“Meanwhile, plenty of other crypto companies continue to offer a lend feature, but Coinbase is somehow not allowed to,” he said.
Meanwhile, the news of the lawsuit seems to have affected Coinbase stock, COIN negatively, which has so far gone down by 11%.