Coinbase Denies Getting SEC Approval for New Acquisitions, Says It Is ‘Not Required’ Either

After reporting that it had secured SEC's approval in regards to new acquisitions, Coinbase has seemingly backtracked to say it never received it, nor did it need it.

California-based Coinbase, one of the world’s leading digital currency exchanges, is apparently sending out mixed signals in regards to the involvement of the US Securities and Exchange Commission (SEC) in the company’s acquisition of Keystone Capital Corp., Venovate Marketplace Inc., and Digital Wealth LLC.

In a bid to expand its operations, and possibly become a SEC-licensed broker, able to list digital security tokens, Coinbase set its sights on the three acquisitions. On Monday, the exchange told Bloomberg that it received a go-ahead for the acquisitions from the SEC and the self-regulatory Financial Industry Regulatory Authority (FINRA).

However, the following day Coinbase VP of Communications, Rachael Horwitz, wrote to Bloomberg, saying,

“It is not correct to say that the SEC and FINRA approved Coinbase’s purchase of Keystone because SEC was not involved in the approval process.”

She further added, “The SEC’s approval is not required for the change of control application […] Coinbase has discussed aspects of its proposed operations, including the acquisition of the Keystone Entity, on an informal basis with several members of SEC staff.”

Regardless of the confusing communication, it appears that Coinbase is set to acquire the three ventures and move on with the process of technology integration and reviews.

While the digital currency exchange currently lists popular cryptocurrencies including Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH) and Litecoin (LTC), it recently revealed plans to work on listing Cardano (ADA), Basic Attention Token (BAT), Stellar (XLM), Zcash (ZEC), and Ox (ZRX).

Since the exchange operates from the United States, with a large local customer base, complying with securities laws is a major concern, particularly when the status of digital currencies is still under consideration. Coinbase currently holds a BitLicense, an operating permission given by the New York State Department of Financial Services (DFS) after thorough scrutiny.

Besides Coinbase, Circle, another prominent digital currency exchange, backed by investors including Goldman Sachs and also also holding a BitLicense, is also seeking SEC approval to operate as a brokerage and possibly list security tokens.

More clarity in terms of the legal status of digital currencies and the expansion of services surrounding their trading is expected to help the market grow organically.