Brian Armstrong, the CEO of Coinbase, a cryptocurrency exchange platform, said that Coinbase ETH staking would cease if regulators pressurized them. Want to know what induced such a statement? Read further.
Why Would Coinbase ETH Staking Be Hindered?
Coinbase CEO reacted to a hypothetical situation on Twitter today by stating that his business will stop offering Ethereum staking services in the case of regulatory concerns in order to protect the security of the blockchain system. As soon as this Coinbase news broke, it again spurted negativity about the exchange.
Lefteris Karapetsas, the creator of the open-source crypto analytics and accounting tool Rotki, presented the query on Sunday. Karapetsas challenged a number of significant Ethereum players to pick between two choices if governmental authorities required that they censor particular addresses.
It's a hypothetical we hopefully won't actually face. But if we did we'd go with B i think. Got to focus on the bigger picture. There may be some better option (C) or a legal challenge as well that could help reach a better outcome.— Brian Armstrong - barmstrong.eth (@brian_armstrong) August 17, 2022
The tweet by Karapetsas asked that:
“Question for @LidoFinance, @coinbase, @krakenfx, @stakedus, @BitcoinSuisseAG.If regulators ask you to censor at the #ethereum protocol level with your validators will you:
A) Comply and censor at protocol level
B) Shut down the staking service and preserve network integrity”
To this, Coinbase CEO responded by tweeting:
“It’s a hypothetical we hopefully won’t actually face. But if we did we’d go with B i think. Got to focus on the bigger picture. There may be some better option (C) or a legal challenge as well that could help reach a better outcome.”
Recently, toward the end of July, 2022, there was news that the United States Securities and Exchange Commission (SEC) initiated an investigation into the major crypto exchange Coinbase. The SEC probe into Coinbase was to check whether it was illegally allowing Americans to transact in digital assets that should have been listed as securities. The aforementioned Coinbase news was reported by Bloomberg.
Amid such tensions and extreme market conditions (crypto winter), we strongly believe that such a derogatory statement of this cryptocurrency exchange was unreasonable. Also, we still have to wait to know whether anything actually impacts Coinbase ETH staking or not. Therefore, it will be intriguing to watch for further updates on the matter.