Coinbase is calling on the US government to establish a new regulator for the crypto and digital assets market.
Coinbase is one of the leading cryptocurrency trading platforms, but it recently ran afoul of the Securities and Exchange Commission (SEC). Coinbase was planning a new service called Lend that would allow individuals to loan cryptocurrency to other users, and charge interest for the transactions.
The SEC warned Coinbase it would sue the company if it proceeded with its plans, sparking a verbal war between the two entities. Coinbase ultimately ended up abandoning Lend under the pressure. In the meantime, SEC Chairman Gary Gensler has said he doesn’t believe crypto is viable long-term.
In that environment, it’s not surprising Coinbase is lobbying for a new federal regulator to oversee the crypto market — one that is not Gary Gensler’s SEC. As part of it’s new regulatory framework, Digital Asset Policy Proposal: Safeguarding America’s Financial Leadership (dApp), Coinbase makes its case:
To avoid fragmented and inconsistent regulatory oversight of these unique and concurrent innovations, responsibility over digital asset markets should be assigned to a single federal regulator.
Like many countries, the US is grappling with the impact of cryptocurrency and is trying to determine how best to regulate it. Gensler has been making the case that the SEC should have sole authority to do so, a position that has many critics, in addition to Coinbase. It will be interesting to see what direction the US government goes.