Coinbase Records Higher Q1 Earnings and Advocates for “Crypto-Specific Regulations”
In its most recent earnings report, cryptocurrency exchange Coinbase announced an increase in revenue during the first quarter, along with advocating for the implementation of “crypto specific rules.
According to a shareholder letter released by Coinbase
on Thursday afternoon, the total revenue increased by 23% quarter over quarter to reach $773 million.
Additionally, the exchange dedicated a section in the shareholder letter to address its concerns regarding what it perceives as “regulation by enforcement” in the United States.
The exchange expressed its opinion on the matter, stating, “America has the potential to be a leader in the crypto space and modernize the global financial system.
However, to enable the growth and development of this innovative technology, we need regulations that are specific to cryptocurrencies instead of relying on enforcement actions.
This will help the industry flourish, and allow America to maintain its leadership position.”
Wells Notice Mentioned in Financial Report
Coinbase has been involved in a legal battle with the U.S.
Securities and Exchange Commission since it was revealed that the exchange received a Wells notice in March.
A Wells notice is a notification sent by the staff of the SEC to inform a company or individual
that they are considering recommending formal charges to the commission.
On April 19, the exchange submitted a 73-page response to the Wells notice, arguing
that the SEC has not adhered to the law by permitting companies like Coinbase to register with the agency.
It is worth noting that the Chair of the SEC, Gary Gensler, has emphasized the importance of companies registering with the agency.
He has also stated that many cryptocurrencies are considered securities, which fall within the jurisdiction of the SEC.
In its shareholder letter released on Thursday, Coinbase did not shy away from expressing its views.
The exchange stated in the shareholder letter, “Although we have been in continuous communication with the SEC,
they have not communicated their specific concerns to Coinbase,
nor have they given any clear or actionable guidance for the industry.
While we hope to avoid legal action, we are fully prepared to defend ourselves and advocate for
the entire crypto industry if necessary.”
Coinbase also announced in the shareholder letter that it is intensifying its direct advocacy efforts in Washington DC.
