• 13 July, 2024
News

Coinbase CEO Says SEC Might Ban Crypto Staking in the U.S.

According to Brian Armstrong, founder and CEO of Coinbase, he has received allegations that the SEC would want to do away with crypto staking in the United States for retail clients. 

Armstrong shared this information with the public. Armstrong continued by saying that he hopes this is not the case because, in his opinion, allowing anything like that to occur would be “a terrible path” for the United States.

The concept of staking is a pretty crucial one for the development of cryptocurrencies. It gives users the ability to take an active role in the operation of open crypto networks. As stated by the CEO of Coinbase, staking delivers a number of beneficial advancements to the industry, including better scalability and security, as well as a reduction in the number of carbon footprints left behind.

“Regulation by enforcement doesn’t work. It encourages companies to operate offshore, which is what happened with FTX.”

Brian Armstrong

Staking is the method through which users can deposit proof-of-stake tokens—like Ethereum—to a blockchain in order to help protect the network. Stakers will get incentives for their participation in helping to secure the network.

In related developments, after the failure of FTX in November 2022, the SEC’s inspection division has placed a significant emphasis on cryptocurrencies and digital assets as one of its main priorities for the year 2023.

In addition, the prominent cryptocurrency exchange Kraken is reportedly the subject of an SEC investigation into allegations that it offered unregistered securities.

If an exemption does not apply, issuers are required under the rules governing securities transactions in the United States to register with the Securities and Exchange Commission (SEC) every time they offer or sell assets the agency deems as securities.

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