Coinbase seeks broker registration from SEC
The SEC does not regard cryptocurrency tokens as securities, and therefore denies regulatory oversight of the sector. This sentiment was reiterated on Wednesday night by SEC chairman Jay Clayton, who insisted bitcoin was not a security.
Coinbase’s move, however, has been made possible by the acquisition of securities broker Keystone Capital.
“Today we’re excited to announce that we’re on track to become a US-regulated blockchain securities trading venue. We believe this is an important moment not only for Coinbase, but the entire crypto ecosystem,” the company tweeted early this morning.
If approved Coinbase would come under the SEC’s oversight and that of the Financial Industry Regulatory Authority (FinRA).
President and chief operating officer Asiff Hirji said this would bring the company a step closer to its goal of being the most trusted way to buy, sell and use different types of crypto assets.
“This is an important moment for the crypto ecosystem, and yet another indication of the maturation of the crypto economy,” Hirji wrote on the company’s blog.
Coinbase hopes that by becoming a licenced dealer-broker it can work with regulators to tokenise existing types of securities, so they can benefit from similar advantages to existing cryptocurrency-based markets such as 24-hour trading and real-time settlement.
“We believe this will democratize access to capital markets for companies and investors alike, lowering costs for all participants and bringing additional transparency and inclusion to the ecosystem,” added Hirji.
Coinbase is not alone in its efforts to bring deeper legitimacy to the crypto-asset environment by seeking the umbrella of regulatory oversight.
Bloomberg reported on Wednesday that Circle Internet Financial, a peer-to-peer payments platform and crypto platform, is seeking registration as a brokerage so it can sell tokenised assets that are considered securities.