“To date, the SEC has never approved a crypto-asset entity as a national securities exchange, despite an extensive dialogue with Coinbase over the years.”
The SEC reviewed Coinbase’s S-1 in 2021, let it go public, and now says its spot trading, staking and custody businesses sell unregistered securities. Coinbase’s answer, written with Sullivan & Cromwell, is that it lists no securities and that staking fails all four prongs of Howey. Both sides are right about the other. The SEC never wrote the rules, and Coinbase built a public company in the gap.