Cryptocurrency exchange Coinbase has finally opened up about the charges imposed by the Securities and Exchange Commission of the United States that the altcoins trading on the platform is digital securities. It is worth noting that Coinbase has been wrapped up in a shroud of bad press and protest from its investors after the financial regulators prosecuted the company employee with the charges of Insider Trading.
However, the comments from the SEC inspectors about around nine Ethereum-based altcoins being securities have also invited the CFTCs to open up a suite of legal action against the American cryptocurrency exchange platform. However, recently Coinbase Chief Legal Officer Paul Grewal stated with the media claiming that the public listed company has rejected the allegations of SEC about digital securities.
Grewal was talking to the journalists recently on behalf of his organization when he claimed that Coinbase legal team is currently conducting a detailed legal analysis of the altcoins that are under the threat of prosecution by the SEC. Additionally, Coinbase’s head of legal matters also claimed that the Department of Justice and SEC have to process the technical evidence and participate in a trial to reach a final verdict on the matter.
The lawyer also claimed that DOJ received the same evidence as SEC prosecutors and the federal legislative agency did open a case or investigation on Coinbase for securities fraud. It is worth noting that the altcoins that are invoked with the suspicion of being digital securities are XYO, DDX, DFX, POWR, RGT, KROM, XYO, RLY, and AMP.
Insider Trading Case
The issuers of the nine altcoins that are charged by the SEC for being digital securities are planning to join forces to fight the SEC case. On the other hand, the altcoin issuers are also working to book as many new platforms as possible in case of a possible regulated cryptocurrency exchange delisting. After SEC launched a case against the XRP token two years ago the altcoin was shortly delisted from all major cryptocurrency exchanges.
The companies are also accelerating their effort in reaching out to their investors for teaming up and ensuring that the position of the said under prosecution currencies does not tumble below the line of stability. In many past cases, the direct result of an SEC open investigation has led to cryptocurrencies facing a massive loss of interest and traction leading to their demise.