Coinbase claims that his staking products are not securities because coin breaks through 22 % weekly
Coinbase claims that his staking products are not securities because coin breaks through 22 % weekly
All eyes in the crypto community were aimed at the SEC and their decision to pursue certain crypto staking offers in the states.
Many believe that Coinbase will have to settle the regulatory authority next to Kraken, which is why the largest stock exchange based in the United States has decided to deal with the matter.
Our products are not securities: Coinbase
The Chief Legal Officer of the Börse, Paul Grewal, claimed in the blog post that the company's staking services do not meet the Howey test criteria, which is why they should not be regarded as securities. The SEC uses four features to determine whether an investment value falls into the HowEy's securities category - efforts by other parties, investments, profit expectations and joint companies.
According to Grewal, crypto staking and especially the product of Coinbase do not meet any of these criteria. It is not an investment because customers keep full ownership of the cryptoplecher and "they have exactly the same as before".
Since crypto-assets are used on decentralized platforms, Grewal argued that they also do not meet the common company element. And since staking rewards are "simply payments for validation services that are provided for the blockchain and no return on capital", they are outside of the appropriate profit criteria.
Finally, these rewards are not based on the efforts of others, since the services of the staking providers do not "do an entrepreneurial, administrative manner or an essential factor" for this. As a result, the Coinbase board of Coinbase emphasized the need for reasonable regulations that will not stop the development of the sector. If the United States does not do this, the country will risk losing users to offshore jurisdictions."... [t] There is no information on staking here, since all participants in the blockchain are connected and are able to validate transactions through a community of users with the same access to the same information."
Coin sags hard
After the SEC kept octopuses and spread rumors that the procedure for local companies could further tighten, Coinbase's shares fell into a free case. They collapsed by 14 % in a trading session, the largest daily price decline in the history of Coin.
On a weekly perspective, the stocks fell by about 22 % and are traded below $ 60. At the beginning of this year, they marked an all -time low at around $ 32 before getting back to $ 80 in the middle of the recovery of Bitcoin.
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