Connect with us


Coinbase Shares fall as SEC Targets Crypto ‘Staking’ with Kraken Crackdown



Coinbase Shares fall as SEC Targets Crypto 'Staking' with Kraken Crackdown

(CTN News) – After CEO Brian Armstrong expressed alarm about allegations that the Securities and Exchange Commission was considering fresh enforcement action against crypto staking, Coinbase shares dropped more than 14% on Thursday.

These speculations came to fruition on Thursday afternoon when the SEC disclosed a settlement with Kraken, Coinbase’s main competition in the cryptocurrency market.

The SEC claimed that Kraken had used its cryptocurrency staking platform to participate in the unregistered offering and sale of securities.

Customers can stake their tokens on several centralized exchanges, like Coinbase, to generate income on digital assets that would otherwise remain idle on the platform.

Investors that use crypto staking often store their digital assets with a blockchain validator, confirming blockchain transactions’ integrity. For securing such assets, investors may be rewarded with more crypto tokens.

Customers may earn 6% interest rates using Coinbase’s Earn staking service.

For the three months that ended on September 30, 2022, the firm reported $62 million in sales from “blockchain incentives,” or nearly 10% of its $590.3 million in total revenue for that period.

It is a potentially profitable source of income for Coinbase, which levies a staking fee ranging from 25 to 35 percent of the benefits consumers get for staking their cryptocurrency.

Armstrong tweeted his fear about the “awful path” the SEC would go if it classed crypto staking as security the evening before the Kraken move.

“We’ve heard allegations that the SEC wants to ban crypto staking for retail consumers in the United States. I hope not,” Armstrong wrote on Wednesday evening.

“It’s a matter of national security that these capabilities be built out in the U.S. when it comes to financial services and web 3,” Armstrong tweeted.

Following a strong year-to-date run for Coinbase and major turbulence for the crypto market, there was a selloff on Thursday.

Coinbase is up more than 77% in 2023, but it has been down more than 76% since the start of 2022 and more than 82% since its IPO in 2021.

On February 21st, Coinbase releases its fourth quarter 2022 results after the bell.

Related CTN News:

Turkey Restores Twitter Service After Government Blockade

Continue Reading

Get a Free Bonus


Find a Job


Recent News

Volunteering at Soi Dog

Learn Spanish Now

Learn Spanish

Buy FIFA Coins

cheap fifa coins