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The Race for Regulation: Coinbase Buyouts to Lead to Potential SEC Registration

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Coinbase has announced that it is on track to register with the US SEC, and become a licensed broker-dealer. It joins the increasingly intense race for approval, which now includes Circle, Square and Revolut.

In a blog post, Asiff Hirji, the President and COO of Coinbase, announced that their path to regulation was going to be eased by the acquisition of three firms; Keystone Capital Corp., Venovate Marketplace, Inc., and Digital Wealth LLC. Keystone and Venovate are registered with the SEC and FINRA as broker-dealers, and Digital Wealth has an RIA license, while Venovate has a license to operate as an Alternative Trading System (ATS). This effectively grants Coinbase a broker-dealer license, an ATS license, and a Registered Investment Advisor (RIA) license.

The final piece of the puzzle is federal regulatory approval, following which the firm would start operating under the regulation of both the SEC and FINRA. Hirji wrote:

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.

It is clear that SEC approval would give the green light not only for other companies to seek clearance by the same path, but would also open up huge new potential for growth. And crypto would certainly become more trustworthy, which would be of massive benefit to a trading company, although this in itself may cause concern amongst those who want digital currencies to remain entirely autonomous, and away from the prying eyes of regulatory bodies.

Is it just a matter of time before these companies are approved? Let us know your thoughts.

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