Coinbase reiterates that staking services will continue
The Securities and Exchange Commission has recently cracked down on centralized staking services. Coinbase reiterates that staking services will continue and may even increase.
The email outline Coinbase’s updated staking terms and condition. It clarifies that users earn rewards from decentralized protocol and not directly from the exchange. The email also records that Coinbase is only a connecting service between users, validators, and procedures. It does not offer a share of its staking rewards.
The SEC’s crackdown on staking services offered by centralized providers has raised concerns. According to them, the staking services provided by Coinbase may affect. However, Coinbase’s clear distinction around protocol rewards. And being a service provider, it appears to stop any potential grey area issues that competing exchange Kraken recently faced.
However, As part of the settlement, Kraken paid $30 million on February 9. It is for allegedly failing to register its staking as a service program with the Securities and Exchange Commission. Kraken no longer offers staking services in the U.S.
The SEC’s complaint against Kraken supposed that users lost control of their tokens by offering Kraken’s staking program. And investors offered outsized returns untied from economic realities, with Kraken paying no interest.
Coinbase has argued that staking services are different from Kraken’s services. Its users maintain control of their assets too. Coinbase Brain Armstrong said on February 10 that the firm is willing to defend its position in court if necessary.
Despite the SEC’s crackdown on staking services, Coinbase’s decision to continue the same. It may be a strategic move to remain competitive in the market. Staking services are becoming increasingly popular in the crypto industry. And Coinbase’s decision to continue this service could attract new users and hold existing ones.
Moreover, Coinbase’s clear distinction between protocol rewards and being a service provider could serve as a model for offering staking services.
In conclusion, we can say that Coinbase reiterates that staking services will continue despite the SEC crackdown on staking services. Its decision to offer its services could be a strategic move to remain competitive.