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Coinbase Could Be the First Exchange to Trade Coins Deemed As Securities

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Coinbase website displayed on smartphone and stack of coins. Source: shutterstock.com

The largest cryptocurrency exchange in the US, Coinbase, will become the first federally regulated exchange to allow trading in coins deemed as securities. The big move could help in listing popular coins like XRP, which has not received the exchange’s nod yet because its status as a security was frequently debated.

Three Acquisitions Will Lead to Security Coin Listing

The Financial Industry Regulatory Authority (FINRA) and the US Securities and Exchange Commission (SEC) have now approved Coinbase’s acquisition of three companies, namely, Digital Wealth LLC, Venovate Marketplace Inc. and Keystone Capital Corp. Post the acquisition, the firm will get federal oversight and will be able to offer security tokens.

Not only this. Coinbase will now have licenses to operate as a registered investment adviser, a broker-dealer, and an alternative trading system.

Circle Internet Financial Ltd., a Coinbase competitor, also hinted last month that it wants to register as a brokerage firm and trading platform with the SEC to be able to help investors buy and sell tokens that are deemed securities. The company also intends to get a federal banking license.

What Does It Mean for the Industry?

Regulations in the crypto markets could allow platforms to oversee billions of dollars’ worth of token transactions, especially in the ICO segment. Note that these coin offerings have already raised over $12 billion this year, more than three times the funds raised in 2017. According to the SEC, a majority of the coins in the market could be classified as securities (ICO token sales). This means that both the issuers and the trading platform must comply with federal laws.

A Coinbase spokesperson said, Coinbase will now integrate its technology with the newly acquired companies. They, however, did not provide a timeline for this. But this will mean that Coinbase will now standardize how customers get onboard.

Last week, the exchange reported that it is considering the addition of five new tokens to its platform — Basic Attention Token, Cardano, 0x Protocol, Stellar Lumens and Zcash. However, it did not guarantee that it would list all these tokens, nor did it confirm when the coins will be listed.

Coinbase Could Be the First Exchange to Trade Coins Deemed As Securities was originally found on [blokt] – Blockchain, Bitcoin & Cryptocurrency News.