A representation of the cryptocurrency is seen in front of the Coinbase logo in this illustration taken March 4, 2022. REUTERS/Dado Ruvic/Illustration/

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July 25 (Reuters) – The U.S. Securities and Exchange Commission is investigating whether Coinbase Global Inc (COIN.O) improperly allowed Americans to trade digital assets that should have been registered as securities, Bloomberg reported News Monday.

In an email response to Reuters, a Coinbase spokesperson said the company does not list securities on its platform.

The cryptocurrency platform has previously asked the SEC to come up with rules that work for digital asset securities.

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“We believe there is a huge untapped market and the United States risks falling behind if the SEC does not engage in a transparent and public regulatory process for digital asset securities,” added the spokesperson.

The US regulator did not immediately respond to Reuters’ request for comment on the Bloomberg report.

The investigation by the SEC’s enforcement unit predates the agency’s investigation into an alleged insider trading scheme that came to light last week, according to the report. (https://bloom.bg/3OyXrBk)

US prosecutors in Manhattan charged a former chief product officer at Coinbase and two others last week with wire fraud in the first insider trading case involving cryptocurrency, along with Ishan Wahi, the exchange’s chief product officer. of cryptocurrency, and his brother Nikhil Wahi arrested in Seattle. Read more

The SEC, in related civil charges, had alleged that Nikhil Wahi and another defendant, Sameer Ramani, sold at least 25 crypto assets for profit, nine of which the agency identified as securities.

An SEC official declined to say at the time whether it would pursue action against Coinbase for listing the tokens considered securities in the complaint.

Coinbase’s regulatory scrutiny has increased since the platform increased the number of tokens it offers to trade in, the report adds, citing two sources.

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Reporting by Jaiveer Shekhawat, Jahnavi Nidumolu and Nivedita Hazra in Bengaluru; Editing by Uttaresh.V and Sherry Jacob-Phillips

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