SEC Goes After Coinbase, Biggest US Crypto Exchange

The hits keep coming for the crypto industry. One day after the SEC sued Binance, the world's largest cryptocurrency exchange, the agency went after Coinbase, the biggest exchange in the US. The SEC accused Coinbase of essentially operating as a securities exchange without registering as one, reports the Wall Street Journal. "Since at least 2019, Coinbase has made billions of dollars unlawfully facilitating the buying and selling of crypto asset securities," according to an SEC statement about the case. Coinbase did not immediately respond to the lawsuit filed in Manhattan federal court.

The agency specifically alleges that Coinbase has been improperly selling at least 13 crypto tokens that the SEC considers to be "securities," even though it is not a registered exchange, per CNBC. “We allege that Coinbase, despite being subject to the securities laws, commingled and unlawfully offered exchange, broker-dealer, and clearinghouse functions,” said SEC chair Gary Gensler in the statement. Bitcoin, the most popular cryptocurrency, fell about 5% Monday on the Binance news to under $26,000 per coin. Tuesday's news will likely worsen the drop. Shares of Coinbase itself were down 20% in pre-market trading on Tuesday. (More cryptocurrency stories.)