US regulator asked Coinbase to only trade in Bitcoin, report says

Securities and Exchange Commission has accused Coinbase of operating illegally

The SEC also alleged that Coinbase traded at least 13 crypto assets that are securities that should have been registered. AFP

The US Securities and Exchange Commission asked Coinbase to stop trading in all cryptocurrencies except Bitcoin before suing the platform in June, The Financial Times reported on Monday, citing chief executive Brian Armstrong.

“We really didn't have a choice at that point. Delisting every asset other than Bitcoin, which by the way is not what the law says, would have essentially meant the end of the crypto industry in the US,” Mr Armstrong told the FT.

“It kind of made it an easy choice … let's go to court and find out what the court says.”

The SEC had accused Coinbase of operating illegally because it failed to register as an exchange. It also alleged that Coinbase traded at least 13 crypto assets that are securities that should have been registered, including tokens such as Solana, Cardano and Polygon.

The SEC told the FT that its enforcement division did not make formal requests for “companies to delist crypto assets”.

“In the course of an investigation, the staff may share its own view as to what conduct may raise questions for the commission under the securities laws,” the newspaper said, citing the SEC.

The regulator sued Binance in June, with both civil cases part of SEC chairman Gary Gensler's push to assert jurisdiction over the crypto industry.

Mr Gensler has labelled the crypto industry a “Wild West” that has undermined investor trust in the US capital markets. Crypto companies say the SEC rules are unclear and that the agency is overreaching by trying to regulate them.