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- The move by the SEC to charge Binance and Coinbase is expected to push Congress to pass clear crypto regulations to avoid the enforcement actions by Gensler.
- The Coinbase staking services account for about 3 percent of the exchange revenue collected.
The crypto regulatory crackdown in the United States puts Coinbase Global at risk of reduced trading volume compared to other centralized exchanges around the world. The publicly traded exchange collects most of its revenue from crypto trading fees among other services including staking programs.
However, the SEC in its latest legal charges against Coinbase wants the exchange to cease offering the staking-as-a-service program since it is not regulated in the country’s securities laws.
Nonetheless, Coinbase Global Chief Executive Officer Brian Armstrong has come out guns blazing indicating that the exchange will continue to offer the staking services irrespective of the ongoing lawsuit. According to Armstrong, the SEC has played in bad faith while regulating the crypto industry through enforcement, which has driven most local investors overseas to markets like Europe, Asia, the Middle East, Africa, and Oceania countries.
Notably, Armstrong noted at the Bloomberg Invest Conference that the staking services account for about 3 percent of the company’s revenue and users can continue enjoying the program.
“We’re not going to wind down our staking service,” Armstrong said on Wednesday. “Again, as these court cases play out, it’s really business as usual.”
The tech billionaire noted that Coinbase is not at risk of a bank run like the one experienced by several regional banks earlier this year. Furthermore, Armstrong insisted that Coinbase is regularly audited by independent entities on its reserves, thus capable of handling mass withdrawals.
Coinbase Fight for the Crypto Industry Survival in the United States
According to Coinbase, 80 percent of Americans agree the traditional financial system is siloed and requires an update. With more than a third of the American population already using crypto assets as a form of payment or investment, Coinbase has vowed to fight for the future of digital assets in the country. The SEC Chair has been accused of being in complete contempt of Congress following the recent legal charges filed against Coinbase.
The latest enforcement action against Coinbase is an egregious example of regulation by enforcement,” Rep. Ritchie Torres, a New York Democrat noted. “It demonstrates a complete contempt for Congress which is in the process of developing a framework for crypto regulation.”
According to Arkansas Rep. French Hill, who also chairs the House subcommittee on digital assets, the SEC chair is trying to divulge from the FTX and Alameda Research failures that could have been prevented months before.
The move by the SEC to charge Binance and Coinbase is expected to push Congress to pass clear crypto regulations to avoid the enforcement actions by Gensler.
Market Outlook
The crypto market has held steadily without outrageous capitulations as experienced in the past years. Moreover, popular crypto analyst Captain Faibik thinks Bitcoin stands a high chance of rallying 25 percent from current levels if the bulls continue to hold on to the support level around $26k.
$BTC is Still Moving inside the Wedge Pattern & Currently Positioned above a Major Trendline on Daily timeframe Chart.
If Bitcoin Maintain its Position above the Trendline and Successfully Breakout from Wedge to the Upside, a Potential Bullish Rally of Approximately +20-25% Can… pic.twitter.com/VHjF6OGU1e
— Captain Faibik (@CryptoFaibik) June 8, 2023
