Coinbase has told its users that its staking services will not be suspended despite a crackdown by the Securities and Exchange Commission on the market. According to a statement released by the exchange, it is looking into the possibility of increasing the program in the coming days. However, the company has released a new terms and condition agreement to guide users in the market.
Coinbase says it will work as a middleman
According to the details available on Twitter, the new terms and conditions overseeing the staking service will kick into effect on March 29. A detailed look into the email shows that users will no longer be rewarded directly from the exchange. However, it explicitly states that all the rewards will be processed from its staking pools.
The email states that henceforth, Coinbase will only be a middleman between the three parties involved in staking. This way, the company will hold onto its staking rewards instead of sharing them among users. The email also assured assets already staked will continue to earn rewards provided the holders do nothing about it. In addition, Coinbase noted that the company is looking to make sure there is a significant increase in the staking rewards in the coming weeks.
The SEC is targeting staking platforms
While Coinbase is already tackling the issue in court, the latest update shows that the company wants to avoid any potential conflicts in the future. However, there are rumors that the SEC is already getting irritated with the prolonged legal tussle with the platform. A previous report mentioned that Kraken decided to settle out of court for $30 million with the regulator over its failure to register its staking service.
In addition to the payment, the platform has also been banned from offering any form of staking service in the United States. A part of the complaint brought forward by the regulator against the exchange was that users that used the staking service could not regain control of their assets. The regulators also had an issue with the company because it failed to pay users the agreed rewards when due. Coinbase has always mentioned that it holds a different staking system compared to companies like Kraken. Its CEO, Brian Armstrong, also reiterated that the company is ready to go to court to argue out its motion if it comes to it.
Source: https://www.cryptopolitan.com/coinbase-updates-staking-amid-sec-crackdown/