BREAKDOWN: The SEC Threatens to Sue Coinbase but Coinbase Is Fighting Back
CoinDesk Podcast Network
CoinDesk
4.8 • 689 Ratings
🗓️ 8 September 2021
⏱️ 23 minutes
🧾️ Download transcript
Summary
According to the company, the SEC has threatened to sue over the not-yet-launched Coinbase Lend product.
This episode is sponsored by NYDIG.
Today on “The Breakdown,” NLW briefly covers yesterday’s bitcoin price crash and why it was driven by market structure more than news. The main topic focuses on revelations from Coinbase that after months of engagement around its upcoming Lend product, the SEC is now threatening to sue. NLW examines the controversy from five dimensions:
- The argument for and against lending as a security
- The SEC’s pattern of regulation by litigation
- How the SEC is rewarding bad actors by punishing compliance
- The concerning surveillance implications of one of the SEC’s requests
- Why these strong-arm tactics are doomed
Should Coinbase take the battle to court?
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NYDIG, the institutional-grade platform for Bitcoin, is making it possible for thousands of banks who have trusted relationships with hundreds of millions of customers, to offer Bitcoin. Learn more at NYDIG.com/NLW.
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“The Breakdown” is written, produced by and features NLW, with editing by Rob Mitchell and additional production support by Eleanor Pahl. Adam B. Levine is our executive producer and our theme music is “Countdown” by Neon Beach. The music you heard today behind our sponsor is “Only in Time” by Abloom. Image credit: Alex Wong/Getty Images News, modified by CoinDesk.
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Transcript
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| 0:00.0 | there are a ton of people who want to work with regulated exchanges, and a ton of people who |
| 0:04.3 | net net would prefer that versus not, but aren't willing to handicap themselves entirely. The net |
| 0:09.2 | effect, then, of this approach to regulation is that actors that demand compliance simply don't |
| 0:14.0 | engage at all, and the ones that are more neutral use the tools at their disposal to flow away |
| 0:18.2 | to less regulated venues just like that water. |
| 0:27.6 | In other words, it's a bad strategy, unless your strategy is to kill the thing through legal pressure, which is something I think we at least have to consider as a possibility here, given |
| 0:33.4 | how aggressively the SEC has been digging in. |
| 0:37.7 | Welcome back to The Breakdown with me, NLW. |
| 0:41.9 | It's a daily podcast on macro, Bitcoin, and the big picture power shifts remaking our world. |
| 0:48.9 | The breakdown is sponsored by Nidig and produced and distributed by CoinDesk. |
| 0:55.4 | What's going on, guys? It is Wednesday, September 8th, and first of all, thank you to everyone |
| 1:00.0 | who shared nice birthday wishes yesterday. I really appreciate it. I woke up this morning to |
| 1:04.6 | near universal consensus on what we needed to cover on today's show. That, of course, is Coinbase |
| 1:10.6 | going on the offensive |
| 1:11.5 | after what they call the SEC's, quote, really sketchy behavior. Now, there are a ton of other |
| 1:17.8 | things that happened yesterday that I'd love to give some coverage to. There is the first day |
| 1:22.2 | of reactions to El Salvador's Bitcoin law. How did everything go? Did the infrastructure hold? Did people actually use |
| 1:28.6 | Bitcoin? If you were on Twitter at all yesterday, you'll also know that President Bucle |
| 1:33.3 | reinforced his Bitcoin or one of us bona fides when he made fun of the IMF and bought the dip in a |
| 1:39.5 | single tweet. There was also new crypto legislation introduced in Panama that has much worthy of consideration, |
| 1:46.9 | and, of course, there were yesterday's wild markets and flash crash. |
| 1:51.4 | Udi Wertheimer tweeted a little while ago, |
... |
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