Several accusations have surfaced regarding the trading of accounts associated with the company’s executives.
Coinbase Denies Insider Trading Allegations
Coinbase has rejected all claims that its executives and insiders sold company shares before public knowledge of the receipt of Wells Notice from the Securities and Exchange Commission (SEC) last week.
A Wells Notice refers to how the SEC informs a company that it intends to recommend legal action against a company.
Coinbase updated its blog on Monday, September 12, to address assertions that began to circulate in media that tracked sales of the company’s executives. The first public-traded cryptocurrency exchange in the United States addressed the strong accusations that the executives dumped the company’s stock, COIN, and large amounts of Bitcoin.
“The assertion that Coinbase’s executives sold shares because of the communication from the SEC is patently false,” Coinbase wrote in their blog.
Coinbase insists that its executives are verboten from trading outside a pre-approved 10b5–1 plan. The executive sale plans from this past week were approved on June 1. This is the second time this year that Coinbase and its executives have faced allegations of this nature, the previous instance occuring in April.
Some have noted that the plan could have still been created with knowledge of the SEC’s opinions because Coinbase came public with Lend in June and the plans were created three months out. The assumption is they knew that they would release Lend in June after having planned the sales on May 31.
From Offense to Defense
Coinbase’s CEO Brian Armstrong harangued the SEC about their response to Coinbase’s Lend product on September 7th, and some questioned his entitlement, as most called for action.
Just a few days after the company looked primed to go on the offensive, it had to put up a guard to deflect more negative attention.
The SEC originally threatened legal action if Coinbase moved forward with their new Lend product. Coinbase is not entitled to explicit answers regarding its products, but the SEC is clearly playing hardball with the crypto company.
Now, some are calling for the SEC to go on the offensive and open an investigation against Coinbase for insider trading. There has been no comment from the SEC regarding insider trading, but all indications point to more regulation.
Source : bsc.news
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