The regulatory fight with decentralized finance (DeFi) is mounting higher. The United States SEC (Securities-and-Exchange-Commission) has focused its eyes on debatably the biggest crypto exchange across the United States. The news followed the notices from five states of the U.S. that headed towards BlockFi during the recent weeks. This week, it has been brought out by the reports that regulatory scrutiny is being undergone by Coinbase for its forthcoming project named Lend. Brian Armstrong, the CEO of Coinbase, had voiced this scenario by labeling the behavior of SEC as “sketchy.”
Coinbase expresses irritation
Coinbase released an intensely verbose blog post that spoke out against the threats given by the agency. It stated that the securities department intends to sue the company for Lend. The firm does not know the reason behind the mentioned lawsuit, he added. Paul Grewal, the Chief-Legal-Officer of Coinbase, shared the post describing that the government’s regulatory commission released a Wells-Notice in the last week relating to the firm’s latest product, “Lend.” It moves on to say that the department issued this warning notwithstanding the efforts that Coinbase made to be following the agency’s regulations. A Wells-Notice contains notification about the preparation of law enforcement operations to be carried out by the regulatory.
The post concluded by specifying that the launch of the Lend project will occur approximately in October, repeating that dialogue is always the center point of every good regulation. Nonetheless, in this scenario, the dialogue appears a one-way discussion up till now, as per the post. The securities department appears to be giving benefit to the ask-for-forgiveness instead of permission policy.
It does not end there
Brian Armstrong, the CEO of Coinbase, went to Twitter to express his annoyance about the matter. He explained the recent sketchy behavior of the regulating agency over a series of twenty tweets. He made the outline of a blog post briefly by mainly focusing on that SEC described the lending option to be a security and did not mention any explanation on why and how of the statement. These objections ask the SEC about what is the pathway to decide that a thing is or else not security. It doesn’t seem that Coinbase’s attempts until yet to comply with the department will be reciprocated with rewards.