The SEC is continuous to analyze Coinbase over previous statements about its consumer base, regardless of latest strikes beneath President Trump to roll again crypto enforcement, The New York Occasions reported.
In response to four people familiar with the matter, the SEC inquiry facilities on Coinbase’s previous claims of getting greater than 100 million “verified customers,” a determine prominently featured in its 2021 IPO submitting.
Consumer quantity points
Regulators are inspecting whether or not that quantity could have misrepresented the dimensions of the corporate’s consumer base and misled traders. Coinbase stopped citing the metric in 2023, acknowledging it could have overstated distinctive customers since people may register a number of accounts.
Coinbase, which is working with regulation agency Davis Polk & Wardwell, says the investigation began beneath the Biden administration and ought to be closed.
Chief authorized officer Paul Grewal referred to as it “a holdover investigation” and famous the corporate ceased utilizing the metric over two years in the past, based on the NYT.
Nonetheless, the inquiry displays how some SEC oversight has persisted even because the company, now led by crypto-friendly Chair Paul Atkins, has dropped quite a few enforcement actions, together with a serious lawsuit in opposition to Coinbase filed final 12 months.
The investigation comes as Coinbase positive aspects institutional clout. The corporate was added to the S&P 500 this week, and CEO Brian Armstrong has develop into more and more seen in Washington.
In March, he attended a White Home crypto summit, sitting only a few seats from President Trump. Coinbase also disclosed a data breach this week that might value as much as $400 million, based on an SEC filing.
