The U.S. Securities and Exchange Commission (SEC) seems to have been cracking its regulatory whip in anger this week, with legal action filed against not one, but two major cryptocurrency exchanges.
On Monday, its target was Binance.US and its enigmatic leader Changpeng Zhao (or CZ to almost everyone who isn’t the SEC). Then on Tuesday, it turned its attention to Coinbase, accusing it of a similar bundle of multiple infringements, although as one of the oldest and largest U.S. exchanges, many consider it a staid and sensible elder statesman of the industry.
It seems ‘hell hath no fury’ like a Gary Gensler, scorned. After serving Coinbase with a Wells Notice in March warning that it might sue the company, Coinbase publicly responded by suing the SEC, of which Gensler is the chairperson, in April.
Around the same time, Coinbase CEO Brian Armstrong publicly backed (and possibly even launched) the ‘Stand With Crypto’ campaign. The campaign urged supporters of clear and sensible regulation for crypto in the U.S. (and elsewhere) to mint an open-edition blue shield NFT on the Zora minting platform.
The NFT is free and not intended to have any value, although minting fees collected by the platform are to be donated to vetted organizations through a ‘Crypto Advocacy Round with Gitcoin’. According to its listing, the NFT “represents our collective stand to protect and promote the potential of crypto.”
Over 13,000 of the NFTs were reportedly minted on the first day of launch, and just over a month later, the SEC has certainly clarified its position on crypto, although few would argue that its current action represents ‘sensible regulation’. Perhaps not the response that the campaign was hoping for?
However, perhaps the SEC was hoping for something other than Crypto-Twitter’s response to the announcement of its current litigation. In which case, clearly it understands Crypto-Twitter even less than it understands crypto itself.
As anyone who isn’t the SEC might imagine, ‘Stand With Crypto’ started to trend, many major industry figures stood up to publicly support the campaign, and at time of writing, the number of NFTs minted stands at almost 140,000.
How the SEC’s lawsuits against Coinbase, Binance (and many other crypto entities) play out remains to be Observed. What is certain, however, is that while the U.S. continues to wage its war on crypto, an increasing number of startups will look for jurisdictions where the regulatory regime on crypto is clear. Which is what the ‘Stand With Crypto’ campaign was asking in the first place.
