The U.S. SEC is finally cracking down on cryptocurrency regulation, classifying ICOs as securities and enforcing their rules on private placement sales. In preparation for potential regulatory changes, Coinbase has announced that it is “on track” to receiving SEC registration.
Legitimatizing Crypto Exchange
As more institutional investors and emerging projects funnel into the digital economy, the global cryptocurrency market continues to mature – drawing the need for an established regulatory framework.
Revealed earlier today, SEC Chairman, Jay Clayton confirmed that ICOs are securities and made clear that digital assets should be regulated with equivalent scrutiny.
A clear indication of the cryptocurrency market coming into maturity, the developing regulatory framework will drastically change the landscape of digital asset crowdfunding, exchange, and investment.
Coinbase in Preparation
Coinbase has been gradually acquiring the proper licenses and registrations to meet the market with a new list of digital assets regulated and ready for exchange.
According to the announcement, Coinbase is “on track” to receiving registration with the Securities and Exchange Commision (SEC) and Financial Industry Regulatory Authority (FINRA) as a broker-dealer “capable of offering blockchain-based securities.”
In addition, Coinbase has acquired three companies – Keystone Capital Corp., Venovate Marketplace, Inc. and Digital Wealth LLC – in a strategic effort to secure an alternative trading system (ATS) license and a registered investment advisor (RIA) license.
Explaining the reasoning behind their acquisitions, COO at Coinbase, Asiff Hirji noted:
“There are now many types of blockchain-based digital assets, from cryptocurrencies to security tokens to collectibles. In the United States, some of these assets will be subject to SEC oversight. With this in mind, securing these licenses will bring us a step closer to our goal, which is to be the most trusted way for our customers to buy, sell, and use many different types of crypto assets.”
In the announcement, Coinbase also mentioned that the licenses would enable the launch of new features and services on their cryptocurrency exchange platform:
“If approved, these licenses will set Coinbase on a path to offer future services that include crypto securities trading, margin and over-the-counter (OTC) trading, and new market data products.”
With their licenses pending approval, Coinbase seems well-prepared for the shifting cryptocurrency landscape and looks forward to bringing cryptocurrency markets mainstream. Hirji further mentioned:
“Ultimately, we can envision a world where we may even work with regulators to tokenize existing types of securities, bringing to this space the benefits of cryptocurrency-based markets — like 24/7 trading, real-time settlement, and chain-of-title.”
Cover Photo by Ian Simmonds on Unsplash
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