The SEC launches an investigation into Coinbase staking products! Bad news for the Coinbase platform. The exchange is again under investigation by the SEC. This time, it's about analyzing the staking products offered by the platform.
Staking products directly targeted!
This time, the SEC is therefore targeting the staking products offered by the platform. This information comes to us directly from the Coinbase quarterly report. The report states:
"The company has received subpoenas and investigative requests from the [US Securities and Exchange Commission] for documents and information regarding certain customer programs, operations, and existing and planned future products, including the company to list assets, the classification of certain listed assets, its staking programs, and its yield-generating stablecoins products."
According to the quarterly report, this staking activity would represent 8.5% of Coinbase's turnover in the second quarter of 2022. The company also considers this to be a preferred field of action for diversifying its sources of income. Despite the opening of this investigation, the platform announced that it would soon offer ETH staking to institutional investors.
Coinbase in the crosshairs of the SEC!
Definitely, the American financial policeman does not leave air to the Coinbase platform. Last month, the SEC was already launching an investigation against the exchange for listing unregistered assets. As with the lawsuit between Ripple and the SEC, it is also a question here of the categorization of the assets offered by the platform.
And to determine whether these are to be classified as commodities (goods and/or negotiable materials) or securities (securities and marketable securities). The announcement of the launch of this survey on July 26 then plunged the Coinbase share on the stock market by nearly 10%.
A few days before, the regulatory body already accused a former employee of having committed insider trading. In a few weeks, this is therefore the third episode of the SEC against Coinbase. Alongside these files, Coinbase is also embroiled in five separate legal cases.
Cases that could become class action lawsuits in the coming weeks or months and whose charges range from customer deception to lack of product information.
What impact on Coinbase stock?
These revelations seem to have little impact on Coinbase stock. While the New York Stock Exchange has not yet reopened for its Thursday session, the asset rose 7.3% in Wednesday's session. An increase which is largely due to the publication of encouraging figures on US inflation. At 8.5% over 12 rolling months for July, the increase in the general level of prices fell by more than 0.5% compared to the previous figures published in June (9.1%).
But this one-day rise should not hide the shortcomings of Coinbase stock in recent months. Very impacted by the crypto market, the action is also bearing the costs of the bear market. Since the start of the year, the asset has lost 62.5% of its value. Compared to its highest level recorded last November, the losses are even slightly higher than 75%.
It must be said that the platform's revenue comes largely from transaction fees. However, during a bear market, transaction volumes are much lower. Coinbase is therefore suffering the full brunt of the crypto winter.
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