Bitrabo Editorial
Mark Cuban, the owner of the Dallas Mavericks and a known cryptocurrency enthusiast, has used his Twitter account to voice his concerns over the US Securities and Exchange Commission (SEC)’s recent handling of complaints against crypto exchange operators, Coinbase in particular. He warns that “no one trusts them,” but questions why investors should not trust the US government agency that is designed to protect them.
Mark Cuban’s Disapproval of SEC Versus Coinbase
Last week, the SEC initiated legal action against Coinbase, claiming that the crypto exchange traded unregistered securities and had violated US securities laws since 2019 at minimum. The complaint also contended that Coinbase engaged in the combined functions of a broker, exchange, and clearing agency, something that traditional financial platforms avoid merging. Additionally, the commission claims that Coinbase violated US laws with several products, such as Prime, Staking, and Wallet.
Mark Cuban, a long-time supporter of cryptocurrencies, expressed his disappointment with the SEC’s approach, claiming that the regulator could have spelled out a clear compliance plan to avoid the current legal disputes. Instead, he accuses the SEC of preferring to litigate rather than provide guidance to companies such as Coinbase.
“The SEC could have easily gone to them and outlined an exact plan to get them to comply,” Cuban tweeted. “If Coinbase or whoever else did not comply, then the SEC could sue over the legal disputes that they have. Instead, they do what they told one of my businesses to do when we called, read these cases, and get a lawyer to figure it out for you.”
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Why You Can’t “Trust” The US Regulator
In his tweets, Cuban argues that the SEC’s approach is creating doubt, with companies afraid to engage with the regulator due to potential legal repercussions. Consequently, the situation makes it difficult for companies to comply with regulations, which ultimately goes against the SEC’s mandate to safeguard investors and maintain fair, orderly, and efficient markets.
The Coinbase lawsuit comes only one day after a similar complaint is filed against Binance, the world’s biggest crypto exchange, and its CEO, Changpeng “CZ” Zhao, highlighting a tightening regulatory climate for crypto firms in the United States.
The crackdown has sparked several repercussions, such as the removal of over 40 trading pairs from Binance US. Following the FTX failure last year, the SEC has been targeting various crypto firms under the guise of “protecting consumers.” Nevertheless, these actions may put the SEC and Chairman Gary Gensler on the hot seat.
Coinbase is pushing back, calling for clearer advice on compliance from the chief financial regulator in the United States. The US Court of Appeals for the Third Circuit has ordered a response from the SEC within one week.