The SEC has leveled allegations against Coinbase for functioning as an unregistered national securities exchange in a case that echoes the ongoing troubles with Binance.

After Monday's lawsuit against Binance, the SEC has extended its scrutiny to Coinbase, filing new charges.

In a case Filed today in the United States District Court in New York, the SEC has charged Coinbase with operating as an unregistered national securities exchange, broker and clearing agency. They have also pointed out that Coinbase neglected to register its crypto asset staking-as-a-service program.

This move doesn't come as a shock, considering that the SEC had already indicated potential violations by Coinbase earlier this year. issued Coinbase a Wells notice Back in March, the SEC warned the exchange of possible breaches of securities regulations. In an interview with CNBC, Coinbase CEO Brian Armstrong stated, 'We’ve engaged with them over 30 times in the past year, and yet we received no guidance on how to improve. Then we suddenly received this Wells Notice.'

Armstrong remarked that it is the duty of regulators to establish a transparent framework that allows the market to flourish securely, but he feels they have utterly abandoned this responsibility.

According to the SEC’s allegations, Coinbase has illicitly amassed billions since 2019 by permitting trading in cryptocurrency securities. The SEC argues that Coinbase is effectively operating as an exchange, broker, and clearing agency without adhering to the legal registration obligations mandated.

The SEC alleges that Coinbase provided several unregistered services:

• A marketplace that aggregates orders from various buyers and sellers using predetermined, non-discretionary methods through which those orders can interact;
• Facilitating transactions involving securities on behalf of Coinbase clients;
• Helping users evaluate settlement terms for cryptocurrency securities while acting as an intermediary for transactions and offering a secure storage solution for those assets.

The SEC has also characterized the following tokens as securities: SOL, ADA, MATIC, FIL, SAND, AXS, CHZ, FLOW, ICP, NEAR, VGX, DASH, and NEXO. Following the filing of today’s lawsuit, the market has seen a decline of 1% to 4% in the prices of SOL, ADA, MATIC, AXS, FLOW, and NEXO. In contrast, FIL, CHZ, ICP, NEAR, and DASH experienced similar gains, while VGX has remained stable.

According to Nansen Interestingly, users have withdrawn more than $57.7 million across various chains from the platform, excluding Bitcoin, since the SEC announced its lawsuit against Coinbase.

In response to statements made by SEC Chair Gary Gensler on this issue, web3 influencer exlawyer.eth remarked, 'It’s important to note that the SEC approved Coinbase’s IPO, fully aware of their business model and after multiple inquiries regarding their operations. If Coinbase was truly not compliant, the SEC should not have allowed it to become a public entity in the first place.' tweet After the SEC's recent complaint regarding Binance was issued, Coinbase's stock took a significant hit, dropping 9%. It fell nearly 20% in pre-market trading from a previous close of $58.70, landing at an opening price of $47.23 today. said on Twitter :

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• Cindy, a journalist for Metaverse Post, covers a broad range of topics in the realms of web3, NFTs, metaverse, and AI, focusing on insights from industry leaders. Having interviewed over 30 top executives, she shares their valuable perspectives with readers. Originally from Singapore, Cindy currently resides in Tbilisi, Georgia, and holds a Bachelor’s degree in Communications & Media Studies from the University of South Australia, with a decade of experience in journalism and writing.