Coinbase Dropped 20% Following a New SEC Probe, Ether Down 7%

07/27/2022By: L, Laura

Tuesdays Latest crypto news: Crypto exchange Coinbase plunged on a new SEC probe. Bitcoin fell 3%, with Ether and Solana’s SOL down 7%.

 

Cryptocurrency exchange Coinbase (COIN) plunged Tuesday while cryptocurrencies fell sharply after a Monday night report that the SEC is investigating the company for letting Americans trade tokens that should have been registered as securities.

 

“Coinbase was considered one of the better-run crypto companies that tried to obey the rules and work with the regulatory bodies,” Edward Moya, senior markets analyst at Oanda said in a note Tuesday. “The risk of tougher regulation has been a constant headache for crypto, and it seems that a couple of tough rulings could cripple a good portion of the cryptoverse,” he added. “If some cryptos are deemed securities, that would make the life of so many brokerages so much harder.”

 

While Coinbase was hit the hardest, falling 20% late on Tuesday afternoon, related players like Marathon Digital (MARA) and MicroStrategy (MSTR) also suffered sharp declines of about 11%.

 

Checking cryptocurrencies themselves, bitcoin (BTC) – probably the only cryptocurrency the SEC may not deem a security – outperformed with a 3% decline. Ether (ETH) and Solana’s SOL (SOL) fell closer to 7%.

 

Tyler Gellasch, executive director of the Healthy Markets Association said, “While the digital asset industry was born and grew outside of any real scrutiny by the SEC, that appears to have changed.” “It’s an existential threat to crypto exchanges and brokers, because many of their current revenue streams are either likely dramatically reduced or outright prohibited in the securities world.”

 

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