The SEC considers Coinbase’s Crypto Yield program to be a security. Brian Armstrong answers

The US SEC has threatened to sue Coinbase over its crypto yield program and mark it as a security.

SEC considers Coinbase's returns program as security

Coinbase CEO Brian Armstrong announced today that the cryptocurrency exchange has come under fire from the US Securities and Exchange Commission (SEC). According to Armstrong, the regulator had threatened to sue the cryptocurrency exchange over its yield program.

The SEC considers the yield program to be a security and that Coinbase did not register with the agency before launching. However, Armstrong said the regulator did not tell the exchange why the program was a security and did not clarify existing policies for Coinbase regarding its crypto yield program.

6/ They refuse to tell us why they think it is a security and instead demand a series of records from us (we comply), demand a statement from our employees (we comply) and then tell us that they will sue us if we continue to launch, with no explanation why.

– Brian Armstrong (@brian_armstrong) September 8, 2021

He added that the crypto exchange informed the US SEC earlier this year of the expected launch of its Coinbase Lend program, which aims to offer users a 4% annual return on deposits using the USDC stablecoin.

The Coinbase CEO noted that there are numerous cryptocurrency trading platforms that are currently offering similar lending services to their customers. He therefore called on the SEC to provide regulatory clarity on this issue to ensure that market participants provide services in accordance with the law.

He added that Coinbase is committed to following the law. However, Armstrong complained that the law is sometimes unclear. Therefore, if the SEC wants to release guidelines, Coinbase would be happy to follow them and adapt their products to the regulatory requirements.

Cryptocurrency market loses over $300 billion in 24 hours

The cryptocurrency market recorded massive losses in the last 24 hours. Yesterday, the total crypto market cap was almost $2.4 trillion. However, the market correction yesterday caused the market cap to fall to the $2 trillion mark, resulting in a loss of over $300 billion in the last 24 hours.

The price of Bitcoin has fallen by almost 9% since yesterday. BTC traded above $52,000 yesterday but has since lost a lot of its value and is now trading at $46,000 per traded coin. Ether is also down over 10% and is trading around the $3,400 region.