Coinbase’s shares dropped with some 3.2% after it turned out that the American regulator Securities and Exchange Commission (SEC) intends to take an enforcement action against the crypto exchange over an interest-earning product that the exchange was planning to launch in the coming weeks.
Coinbase has apparently received a notice by SEC which prompted them to delay the launch of the product until at least October.
The product that caused the kerfuffle is called Lend and is, according to Coinbase, Designed to allow users to earn a 4% annual percentage yield on a stable coin called USD Coin. The exchange says that this could be done by lending clients’ funds to verified borrowers. SEC apparently intends to sue Coinbase over this.
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I wonder whether they will even manage to clear that regulatory hurdle or they will have to give up on that idea altogether.