SEC wants Coinbase to Delist Everything except Bitcoin

Bitcoin exchange The United States securities regulator once instructed Coinbase to delist all cryptocurrencies except Bitcoin, according to CEO Brian Armstrong.

Armstrong disclosed in an interview with the Financial Times on July 31 that the U.S. Securities and Exchange Commission wanted the exchange to delist nearly 250 tokens from its platform before filing a lawsuit against it.

Armstrong reported that at the time, the SEC stated that “every asset except Bitcoin” is a security. “We asked, how did you arrive at that conclusion? Because that is not how we interpret the law,” Armstrong explained.

He recalled that the regulator told him, “We cannot explain it to you, you must delist all assets except Bitcoin.” Gary Gensler, chairman of the Securities and Exchange Commission, stated in a February interview with New York Magazine that “everything other than Bitcoin” falls under the agency’s purview.

Armstrong stated that granting the SEC’s request could have set a precedent and “would have essentially meant the end of the cryptocurrency industry” in the United States.

“It kind of made it an easy choice […] Let’s go to court and find out what the court says.”

The SEC filed a lawsuit against Coinbase in early June, alleging that it operated as an unregistered exchange and offered 13 cryptocurrencies as unregistered securities.

The regulator lodged a similar complaint against Binance days earlier. The SEC informed the Financial Times that its enforcement division does not make formal requests for “companies to delist crypto assets,” but that its staff may share its perspective on which actions may violate securities laws.

The Commodity Futures Trading Commission and the SEC have both taken regulatory action against crypto industry participants.The oversight of the crypto industry in the United States has not rested on a single regulator.

On July 27, the House Agricultural Committee approved a bill that would primarily transfer crypto jurisdiction to the CFTC and clarify the SEC’s crypto-related function. The bill had previously passed the House Financial Services Committee.