For the second time in 24 hours, the US Securities and Exchange Commission has sued a major cryptocurrency exchange. Yesterday, the regulator filed charges in opposition to Binance and its CEO, Changpeng Zhao, with accusations of manipulative buying and selling practices, mishandling buyer belongings, and failures of company management. Today, the SEC adopted up with a go well with in opposition to the Nasdaq-listed change Coinbase, alleging that it has violated securities legal guidelines.

The double salvo sends a transparent message that the SEC is gunning for crypto. The upshot of this may very well be that US buyers lose entry to in style crypto belongings. 

“We are reaching an end state where if the current regulatory crackdown in the US proceeds unchecked, then you’re basically banning most crypto activity in the US,” says Omid Malekan, an adjunct professor at Columbia Business School and writer of Re-Architecting Trust: The Curse of History and the Crypto Cure for Money, Markets and Platforms. 

The SEC’s latest complaint doubles down on its long-standing assertion that many crypto tokens are merely securities, as outlined below current legal guidelines within the US. That means they fall below its purview, the regulator says. Based on that interpretation, the go well with, filed within the Southern District of New York, accuses Coinbase of knowingly working an unregistered securities change by promoting tokens, together with Sol, Ada, and Matic, to US buyers. The SEC additionally accuses Coinbase of violating securities legislation in reference to its staking service, which lets clients earn earnings on sure crypto holdings by pooling them and locking them up.

“You simply can’t ignore the rules because you don’t like them or because you’d prefer different ones: The consequences for the investing public are far too great,” mentioned Gurbir S. Grewal, director of the SEC’s enforcement division, in a public assertion. “Coinbase was fully aware of the applicability of the federal securities laws to its business activities, but deliberately refused to follow them.”

Like Binance yesterday, Coinbase turned the finger of blame again on the regulator, claiming the SEC has didn’t mark out a street to compliance for crypto companies. “The SEC’s reliance on an enforcement-only approach in the absence of clear rules for the digital asset industry is hurting America’s economic competitiveness,” says Paul Grewal, the corporate’s chief authorized officer. Coinbase has “demonstrated commitment to compliance,” he claims, and can proceed to function as common whereas it defends in opposition to the criticism.

This pressure—over the interpretation of current securities legal guidelines and whether or not they apply to crypto—will kind the middle of the case to return, says Noelle Acheson, an impartial crypto analyst. “It’s very much game on,” Acheson says.

With the filings in opposition to Coinbase and Binance, the SEC has now formally alleged that seven of the top 15 largest cryptocurrencies are securities. Bitcoin is considered an exception, and the SEC has not rendered a transparent verdict on Ether, however the company “seems to be using a broad rubric by which to classify these tokens as securities,” says Molly White, writer of crypto-skeptic weblog Web3 Is Going Just Great.