Coinbase CEO Brian Armstrong shared in a series of tweets his concerns about rumors that the SEC (Securities and Exchange Commission) is planning to cryptocurrency strike for retail customers.
The source of the rumors is unclear, but Armstrong expressed his view that such a decision would be very negative for the cryptocurrency market in the United States.
“We hear rumors that the SEC wants to ban cryptocurrency staking in the US for retail customers”, tweeted the co-founder and CEO of Coinbase. “I hope that’s not the case because I think it would be a terrible path for the US if that happened.”
Cryptocurrency staking is a process of holding cryptocurrencies in a digital wallet to validate transactions and maintain the security of the blockchain network. By doing so, users are rewarded with new cryptocurrencies.
Staking services have gained traction in recent months after Ethereum switched to the so-called proof-of-stake method in September last year.
1/ We are hearing rumors that the SEC wants to abolish US crypto strike for retail clients. I hope that’s not the case because I think it would be a terrible path for the US if that happened.
— Brian Armstrong (@brian_armstrong) February 8, 2023
Strike may fall within the purview of the SEC
The SEC did not comment on Coinbase CEO’s tweets, but has repeatedly stated that most digital tokens are securities and should be subject to its regulation. However, the chairman Gary Gensler has previously indicated that strikes may fall within the purview of the SEC. Armstrong argued that strikes are not security.
The attitude of the SEC and its chairman suggests that the rumored ban on cryptocurrency staking for private clients is likely. Gensler has previously said that investable assets fall into the securities category based on the Howey test, and that the expectation of earnings based on the efforts of others by the investor creates assets that can be classified as securities.
While Gensler said he had no specific token in mind when he made his comment, it is interesting to note that while Ethereum allows for staking, the Commodity Futures Trading Commission (CFTC) has classified it as a commodity.
Following a congressional hearing in September 2022, Gensler told reporters that the cryptocurrency foreclosure is an indication that the investing public expects profits based on the efforts of others.
SEC to make a “potentially big” announcement tomorrow?
Citing unnamed sources, Fox Business journalist Eleanor Terrett recently urged people in the community to prepare for a “potentially big announcement” from the SEC tomorrow (2/10).
According to the SEC’s official website, a “closed meeting” is scheduled for February 9 at 2 p.m., and perhaps the announcement could be related to that.
🚨SCOOP: Mine @SECGov sources tell me to be prepared for a potentially big announcement tomorrow. Could it have something to do with a @krakenfx settlement after a private meeting at 2 p.m.? Could settlement terms affect the industry? We will see. 👇🏼https://t.co/AVy0O5dsIG
— Eleanor Terrett (@EleanorTerrett) February 9, 2023
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
