Coinbase chief legal officer says SEC’s Wells notices massive overrun by part of regulator

Paul Grewal, Coinbase’s chief legal officer, says the Wells Notice issued to the crypto exchange by the US Securities and Exchange Commission (SEC) is a sign that the regulator is hostile to the industry as a whole.

Last week, the SEC sent a Wells Notice to Coinbase, saying the regulator has made a “preliminary decision” to recommend the agency bring an enforcement action against the US-based crypto exchange for allegedly violating securities laws.

Coinbase said the move is targeting a number of publicly traded crypto assets, as well as staking service Coinbase Earn, institutional platform Coinbase Prime and Coinbase Wallet.

In an interview with podcaster Laura Shin, Grewal explains why the SEC’s Wells Notice is now a battle for all crypto.

“If responsible with severe AML [anti-money-laundering] and KYC [know-your-customer] programs that are on the public list, petitioning for rules to be made and trying to get in touch with the government can be treated this way, no one else is safe either.

And I think it’s important to understand that this isn’t just a Coinbase opportunity. This is a shot at crypto as a whole. And so we’ll certainly do our part to defend against, which we think is a huge overshoot on the committee’s part.

But it’s not just a battle that Coinbase has to fight alone. This is really something that I think all crypto should pay very close attention to. And we’re going to make sure that all of these issues that we’re dealing with with the SEC are explained to the best of our ability and disclosed and described to the public at large so that everyone has a clear understanding of where things stand.”

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