He wasn’t accused of wrongdoing in the SEC’s complaint.

“Why should the New York Stock Exchange or broker dealers we all know and respect be undermined by this other corner of the capital markets, which is sort of saying, thumbing their nose and saying ‘Catch us if you can’?,” he told Bloomberg’s David Westin.Ĭoinbase was co-founded in 2012 by Brian Armstrong, its chief executive officer. He cast the agency’s efforts to clamp down on crypto as one of both investor protection and US market integrity. Gensler said in an interview on Bloomberg Television that the SEC worked with 10 states to bring its complaint against Coinbase.

“The SEC under Gensler is dead set on enforcing rules that, if followed, would kill off almost all of crypto,” Omid Malekan, adjunct professor at Columbia Business School who has consulted on crypto, said in a text message. The SEC sought a temporary restraining order on Tuesday to freeze some assets as part of that case. The SEC alleged Binance, the world’s largest crypto platform, and its chief executive, Changpeng Zhao, mishandled customer funds, misled investors and regulators, and broke securities rules. The case against Coinbase, coupled with Monday’s against Binance, forms a one-two punch against the industry. At one point on Tuesday, the declines shaved about $1.5 billion off the company’s market capitalization.

The stock fell 12% to close at $51.61 in New York trading. The SEC’s civil lawsuit stands out because of Coinbase’s high profile in the US, and its status as a publicly traded company. At the same time, US regulators warned banks to steer clear of crypto because of potential risks to the financial system, making it harder for US citizens to invest. The SEC moved against Coinbase, the biggest US crypto exchange, after Chair Gary Gensler repeatedly argued that most tokens are subject to his agency’s oversight and that swaths of the industry have been breaking the law.

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