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Coinbase is the only web3 company trying to talk about new laws and regulations for crypto. They spent 9 months trying to talk to the SEC about crypto regulations and breaking new grounds.
And there’s a but.
Let’s get into today’s issue and talk about it. Lesssssgoooo!
Here’s what we have for you and Posty this week👇
Weekly Web3 Updates
Coinbase vs SEC
Web3 Jobs & Reads
Estimated Reading Time: 3:30 minutes
Weekly Weather Report 🌤
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Coinbase & SEC on collision for ‘existential’ clash over crypto
It started on 14 April, 2021 🗓️
Coinbase debuted on the U.S. stock market.
U.S. senators confirmed Gary Gensler, who has called the crypto sector a "Wild West," to lead the Securities and Exchange Commission (SEC), the country's top markets regulator.
And as expected, friction between crypto proponents and the regulator have been brewing. So, what's the deal?
Coinbase wants to introduce a new lending product that would allow users to earn interest on their cryptocurrency.
Sounds pretty straightforward, right?
Well, the SEC doesn't think so.
Coinbase: "Hey, we're just trying to help people earn some extra cash on their crypto. What's the big deal?"
SEC: "Hold up, we need to make sure everything is legal and above board here."
They're concerned that this product might be considered a security, and they're not too keen on that. Apparently, the SEC sent Coinbase a "Wells Notice," which is basically like a "we're watching you" memo. 🕵️
But, fear not frens, Coinbase is not just sitting there.
Coinbase CEO Brian Armstrong notes that the SEC reviewed the business and approved the exchange to go public. He is confident that Coinbase is in the right, though he concedes that such developments are “part of the journey to reforming our financial system.”
Unproductive SEC Talks
Coinbase’s Chief Legal Officer Paul Grewal also expressed disappointment about the notice. He reveals that the exchange had met with the SEC over 30 times in the past nine months. Grewal added that Coinbase has tried to work with the agency only to receive no feedback.
But this is not a standalone incident.
The SEC has gone to court against many crypto firms, including a case against San Francisco-based crypto and cross-border payments company Ripple Labs Inc that some say could offer clarity on when a digital asset is considered a security.
But the SEC and Coinbase debate over an "unspecified portion" of its listed digital assets sets the stage for a more expansive and potentially defining courtroom battle. Coinbase's website lists over 150 crypto assets for trading.
About The Future
Let's be real…
this clash isn't just about Coinbase and the SEC. It's about the entire crypto industry and how it's going to be regulated.
The crypto industry believes it operates in a regulatory gray area not governed by existing U.S. securities laws - and that new legislation is needed to regulate the industry.
Are we going to see more and more clashes like this as crypto becomes more mainstream?
It's a wild ride in the world of crypto, and Coinbase's clash with the SEC is just one example of the drama that's unfolding.
But one thing's for sure - it's never boring in the world of crypto.
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That’s it for today, folks! 👋 We’ll see you with Posty next Monday! 🗞
STOP - DO NOT INVEST IN SUBSTACK'S BROKEN MODEL!!!
Seriously if they are begging for money and VC bailed it means its a broken model. Think about it, how many regular people are paying per writer $5 to $10 per month? Not enough apparently and the next thing they will introduce is advertising which is 1million times worse. This monetization model is for elites, elite writers and elite readers who can afford to pay to "benefit" from their writing. Its not Twitter but its just as elitist as Twitter and will devolve into the same mess and control mechanism.
Go check out web3. Go check out crypto. Go check out the MVP of my solo hobbiest project "dplatform.me" The next platforms will be web3, crypto, micro-transactions, and governed by decentralized autonomous organizations (DAOs) or no one
The future is decentralized!