Coinbase drops plans to lend USDC, fearing SEC lawsuit
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Answer Coinbase drops plans to lend USDC, fearing SEC lawsuit
In a recent brewing battle between Coinbase and the SEC, the SEC regulator appears to be winning it so far.
On Friday, September 17th, cryptocurrency exchange Coinbase issued an update stating that it is reversing its plans to launch its USDC lending program.
This is happening at a time when the US Securities and Exchange Commission has threatened to file a lawsuit if Coinbase does not follow the rules of control in lending stablecoins.
Coinbase complies with the decision of the “SEC”:
Queen Piece updated its decision about the latest product it was going to launch, and indicated in her blog official as follows:
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As we continue our work to obtain regulatory clarity for the crypto industry as a whole, we have made the difficult decision not to launch the announced USDC APY program.
We’ve also paused the waiting list for this program as we turn our work on what comes next.
Coinbase has already received interest from thousands of users across America to sign up for the program it intended to launch.
But Coinbase indicated that it will continue its efforts to provide innovative and reliable software to its customers.
SEC faces a problem with crypto products related to lending and mortgage:
Cryptocurrency lending is nothing new as trading platforms like Gemini already offer it.
Through the Lend product, Coinbase also wanted to allow its users to participate in their USDC stablecoins and earn 4% annual return.
The Securities and Exchange Commission (SEC) appears uncomfortable with the fact that investors will lose custody of their coins and offer them to Coinbase and its partners.
They also noted that Coinbase’s lending program is a security product.
Coinbase CEO Brian Armstrong criticized the SEC for threatening to file a lawsuit against Coinbase, telling the SEC that the SEC’s behavior is unclear.
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However, this will not prevent Coinbase from launching new products on the market.
On Monday, September 20, Coinbase announced Prime brokerage services for its 9,000 institutional investors.
It is worth noting that Coinbase is one of the most preferred destinations for institutional trading.
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