In January 2021, Coinbase Pro delisted XRP from its cryptocurrency list due to fears of a crackdown by the US Securities and Exchange Commission (SEC). But recently, several users of the crypto exchange noticed that the coin appeared to be listed again. The excitement was short-lived, however, as Coinbase Pro quickly denied that XRP was listed on their exchange.
Following this news, XRP experienced sharp price increases. But once the excitement was over, the price crashed again. At the time of writing, XRP is trading at $1.11. This means the coin has fallen 13% in one week.
News of XRP’s re-listing on Coinbase Pro was shared on Twitter by excited investors. They had noticed that certain currency pairs were available on the platform. For example, it was possible to trade XRP-USD, XRP-EUR, XRP-GBP, and XRP-BTC.
Many of these investors reacted to the news and shared their trade setups to profit from the potential rise of the coin. Unfortunately, the new entry was a false alarm.
Shortly after the news spread on Twitter, Coinbase issued its own statement. It said that XRP could be viewed but not traded. It was apparently due to a technical issue.
As previously announced, Coinbase has suspended trading of XRP. Due to a technical issue, XRP was temporarily visible on the Coinbase Pro mobile app for some customers, but not tradable.
Before the exchange made its statement, several traders had their own theories that Coinbase was using it to troll the Securities and Exchange Commission (SEC). The agency had threatened to sue Coinbase over the platform’s launch of a lending program.
Many members of the crypto community speculate that the crypto exchange is ready to fight with the regulator over decisions made.
Legal battle between Coinbase and the SEC
The dispute between the U.S. Securities and Exchange Commission and Coinbase has been around for some time. The SEC wants to regulate the crypto exchange because of its published loan plans.
The loan plan in question is a return-generating product called Lend. Through Lend, the crypto exchange wants to compete with other decentralized products like Compound and Aave and operate a USD Coin-focused loan pool.
According to Brian Armstrong, Coinbase received the following response when the exchange sich contacted the SEC regarding the regulations:
They responded to us that Lend is a security. They won’t tell us why they think it is a security. Instead, they demand a bunch of documentation from us (we comply), demand a deposition from our staff (we comply), and end up telling us that they will sue us if we proceed with the launch. With no explanation as to why.
Coinbase has been working closely with the SEC for the past six months as the company believes in having an “open and substantive dialogue” with regulators. According to the crypto exchange, Lend does not qualify as a security because it is not an investment contract or bond. Although it shares this view with the SEC, it appears that regulators remain staunchly opposed to Coinbase’s new lending initiative.