Coinbase Inc (NASDAQ:COIN) CEO Brian Armstrong on Saturday was asked whether the company has a venture arm that invests in tokens and whether any of those investments lead to listings of those tokens on Coinbase’s platform.
What Happened: Armstrong replied that he was not sure and wanted to ensure he provided an accurate answer. He later confirmed that Coinbase’s investments do not influence listing decisions and clarified that most of the firm’s venture investments have been in startups, as opposed to specific tokens or digital assets.
“I don’t know. I want to make sure I give you a specific answer. But I think most of those have been just standard of venture investments in, in startups. So that’s not a factor in the listing decisions is whether Coinbase has or doesn’t have a position in the company or the token. Well, we don’t take any listing fees. As far as I know, on the digital asset listing group, they don’t look at our personal Coinbase venture investment,” he said, as quoted by The Wall Street Journal.
Former Twitter CEO and Bitcoin (CRYPTO: BTC) bull Jack Dorsey responded to Armstrong’s comment and said, “This true?”
Notably, Dorsey heads Block Inc, which operates Cash App, an application that enables Bitcoin trading and competes with Coinbase’s platform.
Why It Matters: Armstrong’s clarification comes after the Securities and Exchange Commission (SEC) filed a lawsuit against Coinbase on June 6, alleging that the crypto exchange had been operating as a securities exchange, broker-dealership and clearing house without registering with the commission.
Armstrong responded to the lawsuit in an interview with WSJ, explaining that he believes the required registration types were not necessary for Coinbase to operate. He pointed out that Coinbase trades in crypto commodities, which do not attract these kinds of regulations.
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