Coinbase Acquires Financial Services Firm, Plans To Become SEC-Regulated Broker Dealer

Authored by Ana Alexandre via CoinTelegraph.com,

Leading US cryptocurrency trading platform Coinbase initiated the process to become a fully regulated broker dealer by the US Securities and Exchange Commission (SEC). According to an announcement published June 6, this is made possible by the acquisition of securities dealer Keystone Capital Corp. in addition to Venovate Marketplace, Inc., and Digital Wealth LLC.

image courtesy of CoinTelgraph

The acquisition could help the San Francisco-based exchange extend its offerings and subsequently expand into non-crypto financial products. In the announcement, the company said it’s looking to “work with regulators to tokenize existing types of securities,” which the exchange believes will “democratize access to capital markets” for companies and investors in the industry. Asiff Hirji, President and Chief Operating Officer of the exchange, said:

"If approved, Coinbase will soon be capable of offering blockchain-based securities, under the oversight of the US Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA). This step forward is being made possible by our acquisition of a broker-dealer license."

Coinbase, which has reportedly traded $150 bln in assets with over 20 mln customers, announced it is “on track” to listing SEC-regulated crypto securities:

With this move, Coinbase joins other platforms that are looking to trade blockchain-based securities under the regulatory purview of the SEC. Pennsylvania-Based Susquehanna recently amended their broker dealer license to trade cryptocurrencies and Bitcoin futures. The firm plans to offer digital currencies to a small group of clients, and aims to expand the service in the future.

Peer-to-peer payments platform Circle Internet Financial Ltd., is seeking a banking license and registration as brokerage and trading venue with the SEC. This would allow the platform to sell tokens that are considered securities. COO Robert Bench said that a banking license would cut down the number of regulators the platform needed to work with, “You’re able to have a single conversation. It’s hard to have 50 conversations.”

Earlier this week, Coinbase revealed plans to move into the Japanese crypto market, and that it intends to apply for a license with the country’s financial regulator, the Financial Services Agency. Coinbase is said to be working with Mitsubishi UFJ Financial Group (MUFG) on its expansion into Japan. MUFG has invested over 1 bln yen in Coinbase since 2004 through Mitsubishi UFJ Bank and Mitsubishi UFJ Capital.

While Japan is the world’s largest market for cryptocurrencies, with 3.5 mln crypto traders, Coinbase could face stiff competition. There are currently 16 registered crypto exchanges in Japan. Coincheck, which used to be the largest in the country, allegedly generated $150 mln in quarterly profit.

Comments

Adolfsteinbergovitch Killtruck Thu, 06/07/2018 - 10:41 Permalink

Indeed. Frontal fight with old adversaries. 

The market is changing and it will become rarer and rarer to be able to directly buy bitcoins because this is going to become institutionalized and shadowed by stinky "products". 

They call it to mature. 

Hodl now. 

But coins are going to be less and less liquid as right now the logistical chain is being attacked. 

In reply to by Killtruck

Cryptopithicus Homme JibjeResearch Thu, 06/07/2018 - 11:26 Permalink

"Today we’re excited to announce that we’re on track to become a US-regulated blockchain securities trading venue. We believe this is an important moment not only for Coinbase, but the entire crypto ecosystem."

 

Nice self-congratulations Coinbase.  Actually, I think the entire crypto ecosystem couldn't care less about having the establishment's seal of approval branded on our ass.

In reply to by JibjeResearch

spyware-free Exponere Mendaces Thu, 06/07/2018 - 12:35 Permalink

Those are short term problems. Cryptos will have purchasing power as the marketplace grows. You can buy cars and plane tickets already with BTC. Once vendors like AMZN, Walmart and others get on-board, fiat will die a slow death. Even governments will eventually replace fiat with their own tokens which will be used for government services and exchangeable with other tokens in the general marketplace.

In reply to by Exponere Mendaces

dumbhandle spyware-free Thu, 06/07/2018 - 15:32 Permalink

They are dead men walking, sure. But they have years left.  They will be gone when the fiat war starts.  We are not far away.  When crypto breaks a couple or a few trillion in USD market cap, some interesting things are going to happen.  Even at 10%, which is just 3 or 4 trillion, the dislocations will be visible.  Crypto is closing in on 1 trillion USD and it will pass through that mark all of a sudden.  But it won't be Bitcoin that does it.

In reply to by spyware-free

lester1 Adolfsteinbergovitch Thu, 06/07/2018 - 11:04 Permalink

SEC also approved of Bernie Madoff's ponzi scheme for years before finally shutting it down. Coinbase also gives IRS all your information. Not good for you bitcoin whales out there not paying taxes on your "gains".

 

And when the coming financial crisis hits, good luck getting your liquidity out of Coinbase. It will be gone!

 

vote me down if I hurt your feelings..

In reply to by Adolfsteinbergovitch

dumbhandle Adolfsteinbergovitch Thu, 06/07/2018 - 15:17 Permalink

Who would want a bitcoin anyway?  4 transactions per second maximum and little to no programmability.  Bitcoin exists on exchanges, but does not have a real world use anymore.  It was useful when actual transactions per second was below 4, but the network has been topped out for over a year.  It was also useful to trade in illegal goods when government was not engaging in chainalysis.  Many people say it is digital gold or a store of value.  I say if you have it you better ditch it.  Other coins have introduced or are about to introduce sharding, with TPS in the millions, combined with programmability.  Other coins have private transactions.  That makes much more sense than Bitcoin, the first crypto.

In reply to by Adolfsteinbergovitch

pods Thu, 06/07/2018 - 10:43 Permalink

Oh this will end well. Tokenize a slew of bankster created products so we can all then be fucked, no matter how much we have to lose. Double decker scam.

Brilliant.

I guess they had to diversify. Once you get so much you have to focus on keeping it and getting more.

pods

tmosley pods Thu, 06/07/2018 - 10:47 Permalink

If you don't want to use this or that token, then don't use it.

You may be restricted to the poverty that comes from the lack of efficiency found in the barter system at some point, however.

This can be avoided by using some of the crypto that is money, like BCH or Nano, or the crypto that is cash, like any of the privacy coins. Of those, Snowden recommends ZEC.

In reply to by pods

pods tmosley Thu, 06/07/2018 - 11:53 Permalink

Thanks for looking out for me oh certified genius, but I think I can determine what is gonna blow up.

And yes, I use and mine Snowden's favorite. ~30% to ROI since March in fact thanks to the latest bump from being listed on Gemini.

Also use DEX exchanges for exchanging some home run coins, RVN being my favorite at the moment.

We are actually on the same side with this, I just don't want these token/ICO blowups/scams to be used to further smear the actual cryptos that can help society.

pods

In reply to by tmosley

cheech_wizard pods Thu, 06/07/2018 - 12:33 Permalink

> I just don't want these token/ICO blowups/scams to be used to further smear the actual cryptos that can help society.

And which ones of those would that be precisely?

https://news.bitcoin.com/46-last-years-icos-failed-already/

By pretty much every account out there, it is already a fucking coin flip.

Lets toss in something from coindesk.

https://www.coindesk.com/death-ico-4-2018-predictions/

Standard Disclaimer: Never gamble with more than you can afford to lose, right?

In reply to by pods

TheWholeYearInn pods Thu, 06/07/2018 - 14:58 Permalink

@pods

 

I think I'm with mosley (so far) on this one...[and no, I haven't suddenly lost my mind]...

 

Sure ~ bundling & tokenizing shit will lead to many a fiasco, but as always ~ BUYER BEWARE...

 

The net-net is that the more mainstream cryptos get, the more fiat dies its death... Think MARKET CAP (as always)...

 

Peace

In reply to by pods

pods TheWholeYearInn Thu, 06/07/2018 - 15:16 Permalink

I think for most shit in our false reality any publicity is good publicity, but in cryptos these token/ICO offerings get the attention of those with big hammers.  I see this type of "security" as being a derivative of a derivative of an MBS.  
And since most regular people (I consider myself a selected irregular, a little Philly Sales lingo) have no clue about cryptos, they will see these tokens and the like as equal to a more traditional PoW/PoS coin.

Perception is everything, and if people see this as an easy way to lose your nest egg, then it will remain in the dark, buying Carfentanil on the dark web, instead of becoming a paradigm changing technology.

Just my 2c, which is always free.

pods

In reply to by TheWholeYearInn

TheWholeYearInn pods Thu, 06/07/2018 - 16:01 Permalink

"I see this type of "security" as being a derivative of a derivative of an MBS."

 

I probably agree with you 100% on that (from the perspective of how it will be packaged & sold, and how the typical clueless investor will see it, especially after the sales pitch of the greedy broker).

 

But you know something?

 

After watching more than 40 years of 'stock market' pump & dump cycles, and KNOWING that people are probably more 'lemmings' than ever before, notwithstanding all the access to knowledge, etc... Well, to make this short...

 

It still all comes down to FEAR and GREED...

 

& I believe the FOMO aspect of the entire crypto space far, far, far, outweighs anything else once this market gets nudged again, (& one could argue that, every day, there seem to be more unifying aspects to it that have taken it out of mom's basement & closer to the day that the switch will be flipped again).

 

2018, so far, has been a nice & needed technical correction of something whereby the vector had gotten out of hand... Frankly ~ it still has some time variables to get through, which are really unimportant if you HODL... But, by now, we're talking months & weeks, on those time variables (where the support levels get chiseled into stone).

In reply to by pods

tmosley Thu, 06/07/2018 - 10:44 Permalink

If they start listing altcoins en masse, this will largely abate the liquidity shortage that would otherwise follow a Tether collapse.

cowdiddly Thu, 06/07/2018 - 10:44 Permalink

Don't use coinbase they are nothing but common thieves. If you get a new email or phone number good luck. Locked out of my account for almost a year now and they won't resolve a simple phone and email address change. 1000s of people with the same problem.

 

H H Henry P P … Thu, 06/07/2018 - 10:51 Permalink

Coinbase is becoming regulated because they want to make more US Dollars, not Bitcoins.  They care more about dollars just like every other bitcoin believer.  If bitcoin is to be this rebellious form of currency to take over fiat, why regulate it

Hammer of Light H H Henry P P … Thu, 06/07/2018 - 12:05 Permalink

Question: "If bitcoin is to be this rebellious form of currency to take over fiat, why regulate it"

Answer ~

Coinbase is part of the migration guy. Coinbase was engineered by the same people who engineered bitcoin = NSA = NOW they've got full cooperation with Rothschild's US Regulators and Goldman Sachsuckers involved. Bitcoin is without a doubt agency hybrid creation that this Coinbase will open ALL the back doors into the escape of these diseased criminals which will control humanity down to their financial chip-sets.

http://groups.csail.mit.edu/mac/classes/6.805/articles/money/nsamint/ns…

I do heavy investing and have figured out how to play the manipulations. THIS Coinbase is another globalist whore that is without question deep state agency driven.

Bitcoin is and always has been part of the takeover of the US from within and those who are within the bowels of this ganching deep state rot are DEEPLY from the UK. This is without a doubt got Federal Reserve all over it... and that's YET another tell.

Bitcoin is and always has been a valueless lie. Some of us have BEEN in this mechanism, we know what it is.

In reply to by H H Henry P P …