Coinbase Inc, one of the most popular crypto exchanges has just moved closer to getting itself the tag of one of the first federally regulated venues for trading digital coins deemed to be securities.
According to the company sources that spoke to Bloomberg, Coinbase Inc is said it got the green light from U.S. watchdogs to move forward with a trio of acquisitions that gives the company access to necessary licenses.
Coinbase acquisitions go through
The company last month had announced that it had filed for approval from the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) for the acquisition of Keystone Capital Corp., Venovate Marketplace, Inc., and Digital Wealth LLC. These acquisitions would give Coinbase access to broker-dealer license (B-D), an alternative trading system license (ATS), and a registered investment advisor (RIA) license. These licenses would make Coinbase, capable of offering blockchain-based securities, under the oversight of the SEC and FINRA.
According to the blog post released by COO of Coinbase, Asiff Hirji which stated and we quote
“There are now many types of blockchain-based digital assets, from cryptocurrencies to security tokens to collectibles. In the United States, some of these assets will be subject to SEC oversight. With this in mind, securing these licenses will bring us a step closer to our goal, which is to be the most trusted way for our customers to buy, sell, and use many different types of crypto assets.”
He had further added that Coinbase envisions to work with regulators to tokenize existing types of securities, bringing to this space the benefits of cryptocurrency-based markets — like 24/7 trading, real-time settlement, and chain-of-title.
Coinbase Inc. powerfully inching towards getting mainstream
With becoming a Federal Regulated Securities Firm, Coinbase plans, in words of Hirjee, to democratize access to capital markets for companies and investors alike, lowering costs for all participants and bringing additional transparency and inclusion to the ecosystem.
Coinbase, coming under-regulated purview, will be able to eventually handle billions of dollars in tokens sold by companies in initial coin offerings. According to SEC, most of the coins are securities, which means issuers must register and comply with federal laws — as do platforms that handle trading.
Logical next step for Coinbase would be to integrate its technology into the new subsidiaries. It will also have to make sure its employees have proper licenses and review how they report data and onboard customers. Coinbase will also have to comply with other guidelines which a Broker-Dealer generally requires.
It’s not just Coinbase, other company that is in the fray to pursue registration as a brokerage and trading venue with the SEC, is Circle Internet Financial Ltd. The media had also reported that world’s most valuable cryptocurrency platforms, is looking to make a big leap forward into the highly regulated realm of U.S. banks and brokerages.
Coinbase’s entry into the regulated network of exchanges will be a huge booster for cryptocurrencies. New investments could be on horizon ones these acquisitions go through completely.
Will Coinbase change the game for cryptocurrencies and ICO’s? Do let us know your views on the same.