Saudi Press

Saudi Arabia and the world
Wednesday, Apr 01, 2026

Coinbase faces SEC investigation on crypto listings; shares fall

Coinbase faces SEC investigation on crypto listings; shares fall

The drumbeat in Washington for US regulators to do more to oversee crypto has grown louder as digital currencies have tumbled from all-time highs.

Coinbase Global Inc. is facing a US probe into whether it improperly let Americans trade digital assets that should have been registered as securities, according to three people familiar with the matter. The company’s shares dropped as much as 9.2%.

The US Securities and Exchange Commission’s scrutiny of Coinbase has increased since the platform expanded the number of tokens in which it offers trading, said two of the people, who asked not to be named because the inquiry hasn’t been disclosed publicly. The probe by the SEC’s enforcement unit predates the agency’s investigation into an alleged insider trading scheme that led the regulator last week to sue a former Coinbase manager and two other people.

“We are confident that our rigorous diligence process — a process the SEC has already reviewed — keeps securities off our platform, and we look forward to engaging with the SEC on the matter,” Chief Legal Officer Paul Grewal said on Twitter. The SEC declined to comment.

The drumbeat in Washington for US regulators to do more to oversee crypto has grown louder as digital currencies have tumbled from all-time highs, erasing hundreds of billions of dollars in market value. SEC Chair Gary Gensler has homed in on trading platforms and argued that they should do more to protect retail investors.

As the largest US trading platform, Coinbase lets Americans trade more than 150 tokens. If those products were deemed securities, the firm could need to register as an exchange with the SEC. Coinbase shares fell $5.23 to $61.84 at 9:32 a.m. in New York on Tuesday and changed hands for as little as $60.91. The stock has lost almost three-quarters of its value this year.

Coinbase has repeatedly sparred with the agency over how it oversees the industry, and the firm last week called on the SEC to propose clearer rules. Meanwhile, after taking a relatively cautious approach for years, Coinbase has boosted its token offerings.

Monitors display Coinbase signage during the company’s initial public offering (IPO) at the Nasdaq MarketSite in New York City, the United States


Tensions bubbled up further July 21 when the SEC accused one of the company’s former employees of violating its insider-trading rules by leaking information to help his brother and a friend buy tokens just before they were listed on the platform. While the agency didn’t allege wrongdoing by Coinbase, the SEC said it had determined that nine of the dozens of digital tokens the men traded were securities — including seven the exchange says it lists.

Federal prosecutors in Manhattan also charged the three men with wire fraud conspiracy and wire fraud.

In response, Coinbase put out an entry on its blog titled: “Coinbase does not list securities. End of story.” Grewal pointed out that the Justice Department chose not to file securities fraud charges, despite reviewing the same facts as the SEC. He also said that before listing tokens, Coinbase analyzes whether an asset could be considered a security and “also considers regulatory compliance and information security aspects of the asset.”

Investigations by the SEC’s enforcement unit can lead to the regulator suing companies or individuals.

Coinbase, which went public last year, previously acknowledged that it has faced scrutiny from the regulator. In its first-quarter earnings report, the firm said it had “received investigative subpoenas from the SEC for documents and information about certain customer programs, operations, and intended future products, including the company’s stablecoin and yield-generating products.”

Gary Gensler, chairman of the US Securities and Exchange Commission (SEC), speaks during a hearing of the House Appropriations Subcommittee in Washington, DC, the United States


To decide if a digital asset is a security, the SEC applies a legal test, which comes from a 1946 US Supreme Court decision. Under that framework, the agency considers a token generally to be under SEC purview when it involves investors kicking in money to fund a company with the intention of profiting from the efforts of the organization’s leadership.

Gensler has long argued that many cryptocurrencies come under the regulator’s jurisdiction and that firms offering them should register with his agency.

However, the SEC mostly hasn’t said specifically which coins are securities, and exchanges decide whether to list an asset. Platform operators are seeking to avoid offering those deemed securities because doing so could trigger investor-protection rules, some of which crypto enthusiasts say are incompatible with digital assets.

Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Saudi Arabia Updates Travel Advisory as Regional Conflict Intensifies
Saudi Arabia’s Sadara Suspends Petrochemical Production as Conflict Disrupts Operations
Iran Urges Saudi Arabia to Remove US Forces Amid Escalating Regional Tensions
Gulf Allies Urge Trump to Sustain Campaign Until Iran Is Fully Defeated
Saudi Arabia Unveils Strategic Rail Freight Corridors Connecting Gulf Ports to Jordan
Saudi Arabia Intercepts Drones and Ballistic Missiles in Major Defensive Operation
Houthi Escalation Opens New Front in Expanding Iran-Linked Conflict
Major Saudi Chemical Plant Halts Operations Amid Regional Conflict Disruptions
Strike on US Radar Aircraft in Saudi Arabia Signals Escalating Threat Capabilities
US Citizens in Saudi Arabia Advised to Shelter Indoors Amid Rising Regional Tensions
How Britain’s Prime Minister Controls U.S. Bomber Access in Escalating Iran Conflict
Saudi Arabia Urges Trump to Lead Strategic Reset in Middle East as UAE Weighs Ground Role
Reed Smith Expands Saudi Presence with Senior Corporate Appointments
Trump Announces Approval of F-35 Fighter Jet Sale to Saudi Arabia
BBC Faces Scrutiny Over Allegations of Paid Content Linked to Saudi Arabia
Ukraine Secures Defense Agreements with Qatar and Saudi Arabia as UAE Talks Advance
Oil Prices Surge as Saudi Arabia Adjusts Supply Amid Escalating Iran Tensions
Saudi Arabia Condemns Attacks on Kurdistan Leaders and Reaffirms Backing for Iraq’s Stability
Saudi Arabia Weighs Strategic Interests as Iran Conflict Raises Regional Stakes
Severe Thunderstorms Sweep Across UAE and Saudi Arabia Bringing Heavy Rainfall
Trump’s Strategic Alignment with Saudi Arabia Reflects Expanding Economic and Diplomatic Synergy
Saudi Arabia Strongly Condemns Attacks on Presidential Residences in Hawler
Saudi Stocks Edge Lower as Tadawul Index Closes Slightly Down
Houthis Enter Expanding Iran Conflict as US Deploys Additional Troops
Iran Seeks Assurances for Regional Allies as Saudi Arabia Presses for Firm Security Guarantees
Iranian Strike Reportedly Destroys $270 Million US E-3 Sentry Aircraft at Saudi Air Base
Iranian Strike on Saudi Base Leaves Ten American Personnel Injured
Ukraine Claims Russia Shared Satellite Intelligence with Iran Ahead of Saudi Base Strike
Pakistan Engages Regional Powers in Diplomatic Talks Over Iran Conflict
Escalating Iran Conflict Brings Renewed Focus to US Military Presence in Saudi Arabia
Iranian Strike Targets Saudi Airbase, Damaging Key US Military Assets
Modi and Saudi Crown Prince Emphasise Secure Shipping Routes in Talks on West Asia Conflict
Dallas-Based Company Secures One Billion Dollar Hotel Development Deal in Saudi Arabia
Zelensky Secures Defence Cooperation Deals with Gulf States During Strategic Regional Tour
Trump Calls on Saudi Arabia to Join Abraham Accords in Push for Expanded Middle East Cooperation
Trump Balances Humor and Praise in Remarks on Saudi Crown Prince
Saudi Arabia’s Strategic Pipeline Reaches Seven Million Barrel Capacity to Bypass Hormuz
Rubio Signals U.S. Could Conclude Iran Conflict Within Weeks as Air Campaign Intensifies
More Than a Dozen U.S. Soldiers Injured in Saudi Base Attack as Iran-Backed Houthis Expand Conflict
Iranian Strike on US Base in Saudi Arabia Injures Troops and Damages Aircraft
Pakistan to Convene Regional Talks with Saudi Arabia, Turkey and Egypt Amid Iran War Diplomacy
Ukraine and Saudi Arabia Reach ‘Mutually Beneficial’ Defence Agreement
Ukraine to Share Battlefield Expertise with Saudi Arabia Under New Defence Agreement
Trump Takes Center Stage at Saudi Arabia’s FII Miami Amid Escalating Iran Conflict
Gulf States Explore Pipeline Routes to Bypass Strait of Hormuz Amid Rising Tensions
Iran Conflict Drives Saudi Arabia to Deepen Security Ties with Ukraine
Saudi Arabia Reviews Desert Ski Resort Plans with Cancellation of Key Building Contracts
Saudi Arabia Targets Business Hotel Shortfall with $1 Billion Development Push
Iran and Allied Forces Intensify Strikes on Energy Sites and Urban Areas Across Region
Ukraine and Saudi Arabia Formalise Defence Cooperation Agreement, Zelenskiy Announces
×