Coinbase, the United States' leading cryptocurrency exchange, may be required to delist 13 digital tokens, including Cardano (ADA), as a result of a lawsuit filed by the U.S. Securities and Exchange Commission, according to an interview conducted by Financial Times reporter Scott Chipolina with CEO Brian Armstrong.
The SEC case alleges that these tokens, which form a small fraction of the 240 assets available on the platform, are unregistered securities.
Armstrong described the delisting of ADA and the other tokens as "the worst-case scenario" but downplayed the potential impact of such a move, suggesting that their delisting would not pose a substantial loss of revenue or present an existential crisis for the company.
As reported by U.Today, Input Output Global (IOG), the developer behind the Cardano blockchain, has firmly rejected the SEC's assertion that Cardano's native token, ADA, should be classified as a security.
Earlier today, Coinbase filed a motion to dismiss the lawsuit, citing the recent decision in the Ripple case to bolster its case against the SEC.
Staying in U.S.
The Coinbase CEO dismissed the idea that Coinbase could relocate to more crypto friendly countries amid ongoing regulatory scrutiny in the U.S., contrary to recent speculation spurred by the firm's procurement of a license in Bermuda.
This clarification comes after earlier reports about the firm's acquisition of a Bermuda license. Significantly, Armstrong emphasized that Coinbase has no backup plan for relocating its operations. The exchange is committed to staying in the U.S., with its international licenses serving as a mechanism for global expansion rather than a contingency against domestic regulatory challenges.
SEC Chair Gary Gensler previously characterized the crypto market as being "rife with non-compliance."
In 2022, the exchange's U.S. revenue was nearly $2.7 billion, dwarfing its international earnings of just over $500 million. Armstrong reassured readers that even in the event of a loss in the SEC lawsuit, Coinbase would remain a prominent player in the American cryptocurrency industry.