According to Bloomberg, the Securities and Exchange Commission (SEC) has launched an inquiry into Coinbase (NASDAQ:COIN) to discover if the firm allowed Americans to trade digital assets that should have been registered as securities.
Coinbase dropped 5% yesterday and was down another 3% in pre-open trade on Tuesday. Every day, the firm provides hundreds of tokens on its platform.
According to Reuters, Coinbase defends itself by claiming that “there is a massive untapped market and the United States risks being left behind if the SEC does not engage in a transparent and public regulation procedure for digital asset securities.”
This probe would precede the one against Coinbase that made headlines last week for possible insider trading.
Coinbase, according to the SEC, transacted in nine unregistered securities.
According to the SEC report, Coinbase’s regulatory monitoring has intensified as the site extended the number of tokens in which it enables transactions.