Coinbase Global is easily one of the biggest cryptocurrency exchanges in the world. Not only does it have the largest reach of any other platform, but it was also the one to gain widespread acceptance from different countries. And Coinbase tried to diversify its lineup of products by offering Lend, their cryptocurrency lending program.
However, Coinbase soon came head to head with the United States Securities and Exchange Commission. The SEC did not trust Coinbase and their new operation, which is why they threw a wrench in the machine. Unfortunately, today Coinbase has announced that they have stopped working on their plans of a first-of-its-kind cryptocurrency lending software.
Coinbase announced its decision to abandon the project in a blog post on its official website. Their announcement saw a lot of crypto enthusiasts and investors quite upset. More importantly, their decision to make to drop the innovative idea soon came after Gen Gensler’s announcement.
The SEC’s chairman Gen Gensler made a statement about cryptocurrencies that did not surprise anyone. In his statement, he said that he would be cracking down and would harden his position on cryptocurrencies. He shared his prepared statement on September 14 to the Senate banking committee.
In the blog post, Coinbase said that they will be making the difficult decision to not launch their crypto trading platform. They said that despite working towards better regulatory clarity throughout the market, they had to shut down their service. However, they were still quite optimistic about their future and were determined to not let this set them back. They continued that they will be looking for more ways to innovate and create trusted programs for the crypto market.
To end their statement, they said that customers from around the country in the hundreds of thousands had signed up to the service. And following the announcement, they were instantly disdainful from the many people who were holding out hope.
Prior to the SEC chairman making an official announcement warning the crypto market, they had sent out another warning. More specifically, the SEC was threatening to sue Coinbase in the event that they try to push their new Lend program forward.
Coinbase also said that they got a Wells notice that said that the SEC will be looking to take legal action against Coinbase. The letter further said that since they considered Coinbase’s new product a threat, which is why they were taking such extreme action. Brian Armstrong, the CEO of Coinbase, called their behavior sketchy in a series of tweets that he made. It is safe to say that he was not happy with the decision that they had to make.