The tension between Coinbase and the Securities and Exchange Commission (SEC) continues, raising new concerns about the future of the cryptocurrency world. The role of Celsius Network in particular has intensified this tension.
Coinbase and SEC Tensions
The SEC has some concerns regarding Coinbase’s operations, especially with allegations of violating federal securities laws. The SEC accuses Coinbase of operating as an unregistered broker and exchange.
The dispute between Coinbase and the SEC escalated after the regulator sent a Wells notice to the exchange in March, alleging violations of federal securities laws. Coinbase, however, denies these allegations and expresses its intention to continue its collaboration with Celsius Network.
Celsius Network and Coinbase Collaboration
Celsius Network plans to distribute cryptocurrencies to international customers, considering using Coinbase’s platform for this distribution. However, the SEC has raised significant objections to this collaboration. The regulator argues that this collaboration might require court approval and needs further scrutiny.
“Coinbase Agreements contemplate brokerage services and application trading services, such as those that Commission staff have identified as concerns in litigation against Coinbase in federal court in the District of Columbia, rather than the services of a distribution agent.”SEC
Coinbase states that it is proud to collaborate with Celsius Network and finds it difficult to understand the reason for the SEC’s objection. Coinbase’s Chief Legal Officer, Paul Grewal, said the following in a statement:
“I wonder why the SEC objects to a reputable U.S. public company taking on this role?”
Legal Troubles for Celsius Network
Celsius Network has recently faced financial difficulties. It filed for bankruptcy last year and disclosed owing billions of dollars. Additionally, it has been accused by the SEC of fraudulent and unregistered sales of “crypto-asset securities.“
The SEC has filed a lawsuit against Celsius Network, alleging that the platform provided false information about its financial status to investors and manipulated the price of its native token, CEL. These allegations have had a negative impact on Celsius Network’s reputation.
Concerns and Questions
Over the past few days, more parties have raised objections to Celsius Network’s plan. These objections bring to the forefront concerns about whether creditors in August have sufficient information to approve or reject the plan. Some significant figures, including a U.S. Representative, are closely monitoring Celsius Network’s operations.