Received a ‘Wells notice’, the notice that the Authority is about to sue you
A formal notice, heralding a lawsuit for violating securities trading laws. It’s technically called ‘Wells notice’. Coinbasethe largest cryptocurrency platform in the United States, is in the crosshairs of Secthe American authority that supervises Wall Street.
The news immediately brings prices down and alarms the whole cryptocurrency world. Because Coinbase has so far been considered ‘a safe place’ in which to exchange cryptocurrencies, a sort of outpost that after the 2021 listing seemed sheltered because it was called to respect the rules. Now it is precisely the violation of the rules that is being contested. In particular, those on listed digital assets, in addition to the Coinbase Earn and Coinbase Wallet staking service. The reassurances that have arrived, the products and services “will continue to function normally as always”, risk however not being enough.
The CEO Brian Armstrong, first in a series of tweets and then referring to a long press release, reacts by claiming to be fully legal. “Tell us the rules and we will follow them. Show us a path to registration and we will register the parts of our business that need to be registered. Meanwhile, the US cannot afford to have regulators keep threatening players in the construction industry cryptocurrencies for doing the same legal and compliant things they’ve always done.”
This “unfair” approach, Armstrong adds, “will only take innovation, jobs and the entire industry abroad.” Basically, he insists, “we are the same company we were on April 14, 2021 when we became a public company at the end of the long process with the same SEC.” For this, “we remain confident in the legality of our goods and services and, if necessary, we will go to trial to defend the clarity we have always advocated and to demonstrate that the SEC is simply not fair and reasonable when ruling on digital assets”.
It is possible that there is a problem of ‘interpretation’ or the desire to tighten even with respect to positions already taken. But one thing is certain, if Coinbase were to fall, there would be a real risk of the collapse of the entire castle of cryptocurrencies, already in a crisis of credibility and results for months. (by Fabio Insenga)