Coinbase revealed in a March 22 filing that it has received a Wells Notice from the U.S. Securities and Exchange Commission (SEC).
The notice says that the SEC has made a preliminary determination that will see it recommend an enforcement action against Coinbase.
The pending action will likely allege that Coinbase violated federal securities laws. The allegations will concern parts of Coinbase’s main trading platform (ie. spot market), as well as other services such as Coinbase Earn, Coinbase Prime, and Coinbase Wallet.
Coinbase has publicly responded to the Wells notice on its blog, stating that it is confident that its assets and services are offered legally.
The firm said that the Wells notice “is not a formal charge or lawsuit, but … can lead to one.” It added that the notice does not provide enough information for a detailed response.
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