In an interview on Feb. 10, acting SEC chair Gary Gensler put the crypto industry on notice over staking, and U.S. regulations.
SEC to hammer down more exchanges
Barely 24 hours after the shutting down Kraken’s crypto staking service in the United States and reaching a $30 million settlement with bitcoin (BTC) trading venue, Gary Gensler, the chair of the Securities and Exchange Commission (SEC), sounded a note of warning to other crypto market participants in the region.
“Kraken was asking the American public for their coins and saying I’ll give you a return; 4% to 20% returns and the problem was they were not disclosing to the investing public the risk that the investing public was entering into.”
Gary Gensler, SEC cheif.
Gensler added that under U.S. laws, such offerings must come under the purview of the SEC. He further stated clearly that the enforcement action against Kraken should serve as a clarion call to other exchanges such as Coinbase which offers crypto-staking products, to come under the SEC’s purview.
In contrast to Coinbase’s staking services, which are “fundamentally different and are not securities,” the executive claimed that Kraken’s staking platform “basically offers a yield product.”
Paul Grewal, chief legal officer at Coinbase, asserted on Feb. 9 that the termination of Kraken’s staking services has no impact on Coinbase’s staking program.
Brian Armstrong, the CEO of Coinbase, also stated on Twitter that the exchange will continue to oppose the government in maintaining services like staking. He criticized the unclear stakes regulations, adding that as part of Coinbase’s purpose, they will continue to fight for economic freedom.
Protecting their clients from governmental overreach occasionally involves having the most reputable brand in crypto.
Armstrong’s aspirations for “economic independence” drew an immediate response from the community, with many condemning Coinbase for avoiding XRP after delisting the coin in 2020.
The SEC filed a lawsuit against Ripple, claiming that the company broke securities laws by selling XRP coins, which prompted the decision to halt XRP trading.
Following more than two years of Ripple’s legal struggle with the SEC, the community has also once more promoted the relistXRP hashtag on Twitter, with many highlighting the fact that XRP has not yet recognized security.
In addition, many pro-crypto activists brought to a recent judicial victory concerning the purchase of LBRY Credits {LBC} tokens, drawing comparisons to XRP.
The sale of LBRY tokens in the secondary market does not constitute a security; the SEC acknowledged this in writing on Jan. 30. This implies that participants like Coinbase can provide LBC trading without any repercussions.
“Coinbase and others should instantly add XRP after LBRY’s legal team, and Deaton succeeded in getting the SEC to confirm on the record that secondary market sales of cryptos, for example through exchanges, do not constitute securities transactions.”
Eviszen, Twitter user.
Significant crypto introduced in 2012 and is a native member of the Ripple protocol is called XRP. Its goal is to offer financial instruments like a cross-border payment method.
Despite spending the last few years embroiled in a protracted legal dispute with the SEC, XRP has maintained its position as one of the top cryptos in the world according to market cap.
With a market capitalization of close to $20 billion as of this writing, according to data from CoinGecko, XRP is the sixth most valuable crypto asset.
Source: https://crypto.news/sec-chair-gensler-puts-crypto-industry-on-notice/