[NEWS] Bitwise executive says Coinbase benefits from hostile regulatory environment

The regulatory environment is favorable

Matt Hougan, CIO of cryptocurrency management company Bitwise, said he believes the current hostile regulatory environment for crypto assets in the United States is "a benefit to Coinbase."

This comes after the SEC (US Securities and Exchange Commission) recently issued a Wells Notice to Robinhood. He argued that this environment has enabled cryptocurrency exchange Coinbase to draw out its capabilities, leading to solid revenues and helping it raise funds and promote its business interests.

Coinbase has been at odds with the SEC, but it reported revenues of $1.6 billion in the first quarter of 2024, including from transaction fees.

Hougan then noted that Coinbase is diversifying its services beyond its core cryptocurrency exchange business. These include the growth of USD Coin (USDC), a US dollar-pegged stablecoin built on Ethereum, and the offering of futures trading outside the US.

SEC's actions against cryptocurrency-related companies

The SEC issued a Wells Notice to Uniswap, a major DEX, and Consensys, a blockchain company, last month, and to Robinhood, a US stock trading app, on the 6th of this month.

A Wells Notice is a warning that the SEC will take legal action against a company or individual. All of them are alleged to have offered unregistered securities to customers, in violation of the Securities Act.

Coinbase was also sued by the SEC last year for offering unregistered securities, as well as operating unregistered exchange, brokerage, clearing, and other services.

Reference:Hogan X
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