The two cryptocurrency exchanges are under increased U.S. scrutiny for allegedly listing unregistered securities and evading sanctions, respectively.
The two cryptocurrency exchanges are under increased U.S. scrutiny for allegedly listing unregistered securities and evading sanctions, respectively.
- Coinbase is reportedly under investigation by the SEC.
- The investigation is meant to determine if the company listed cryptocurrencies that should have been considered securities.
- Kraken reportedly is under investigation by the U.S. Treasury Department for violating sanctions.
Scrutiny over cryptocurrency exchanges from U.S. regulators is growing by the day.
Coinbase Global Inc., ($COIN) is facing a probe from the Securities and Exchange Commission (SEC) following recent charges being brought against a former product manager of the company for insider trading[1].
The SEC’s current investigation into Coinbase is meant to determine whether or not the exchange let Americans trade cryptocurrencies that should have been listed as securities, according to three sources[2]. The SEC probe actually predates the most recent arrest of Coinbase’s former product manager, as noted[3] in a previous SEC filing.
The former Coinbase employee, Ishan Wahi, allegedly worked with his brother and one other individual to leverage insider information related to the listing of specific tokens to take advantage of market conditions.
During the time of the arrest the SEC did not accuse Coinbase of committing insider trading itself, nor did it bear any responsibility for the former employee’s actions against the exchange. However, the regulator did determine that nine of the tokens leveraged for insider trading were considered securities[4]. Coinbase confirmed[5] that the platform lists seven of these securities on a blog written by its chief legal officer, Paul Grewal, but denies that the assets are actually a security.
“The SEC’s charges put a
