Coinbase lands regulatory approval to list securities

Coinbase has reportedly received regulatory approval to sell cryptocurrency tokens that are deemed securities.

The US Securities Exchange Commission and the Financial Industry Regulatory Authority have approved Coinbase’s purchase of Keystone Capital, Venovate Marketplace and Digital Wealth. This deals will enable will enable the cryptocurrency exchange and wallet service to offer security tokens under federal oversight according to various media reports.

It means that Coinbase now has licenses to operate as a broker dealer, an alternative system and a registered investment advisor, the company said in a statement last month.

While just last week, Coinbase stated that it was exploring adding five new tokens to its exchange, including Cardano, Basic Attention Token, Stellar Lumens, Zcash and 0x.
Earlier this year, the SEC stated that platforms trading digital assets deemed to be securities must register with the regulator as an exchange, therefore governing them by the same rules as traditional exchanges.

Organisations aiming to operate as an ATS are also subject to regulatory requirements. The regulator said: “Registration as a broker-dealer subjects the ATS to a host of regulatory requirements, such as the requirement to have reasonable policies and procedures to prevent the misuse of material non-public information, books and records requirements, and financial responsibility rules, including, as applicable, requirements concerning the safeguarding and custody of customer funds and securities.”

Obi Nwosu, CEO and co-founder of Coinfloor, recently told RegTech Analyst that despite recent advancements in market regulation for cryptos being ‘an encouraging sign’, more legislation is needed to add additional safeguards.

“Recent advancements in market regulation have left us encouraged of things to come,” Nwosu said. “The introduction of appropriate regulation, infrastructure and technological solutions will help cryptocurrencies achieve their full potential in delivering both social and economic benefits as originally intended.”

Copyright © 2018 RegTech Analyst

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