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July 21, 2022

SEC: Coinbase Is Listing Assets That Are Securities

At least nine of the digital assets that are listed on the cryptocurrency exchange known as Coinbase are allegedly unregistered securities, according to the Securities and Exchange Commission (SEC). AMP (AMP), Rally (RLY), DerivaDEX (DDX), XYO (XYO), Rari Governance Token (RGT), LCX (LCX), Powerledger (POWR), DFX Finance (DFX), and Kromatika (KROM) are the nine assets in concern. 

If a digital token or crypto asset is able to fulfill the requirements of the Securities Act’s definition of a security, then it is considered to be a crypto asset security. The Securities Act defines security as an investment contract.

The firm that is responsible for the KROM token, Kromatika Finance, has provided a response to the claims of insider trading made by the SEC about the cryptocurrency exchange. Concerning the business’s listing, it is not apparent whether or not the SEC intends to pursue charges against the corporation.

They are also certain that Coinbase would assist the authorities in clarifying the circumstances of the mistake made by this one person acting alone.

Although previous officials of the SEC have said publicly that the agency does not consider cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) to be securities, the current Chairman of the SEC, Gary Gensler, has been less transparent than his predecessors. A month ago, he said to CNBC that the only thing he would definitively state on the nature of cryptocurrencies is that Bitcoin is not a security while dodging queries regarding Ethereum (ETH).

The Securities and Exchange Commission (SEC) has taken the position that almost every Ethereum-based token sold in an initial coin offering (ICO) is unregistered security, and the Commission is currently embroiled in a lawsuit against the cryptocurrency payments company Ripple (XRP) over Ripple’s own sale of XRP. The lawsuit has a potential value of $1.3 billion.

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