Why Coinbase Stock Dropped Today

Cryptocurrency exchange Coinbase Global (NASDAQ:COIN) announced today that the U.S. Securities and Exchange Commission (SEC) intends to sue the company over Coinbase’s Lend program, which has been announced but hasn’t yet launched. The company expressed confusion and defiance over the SEC action, and Coinbase shares were down 4.5% as of 11 a.m. EDT. 

So what

The company received a Wells notice from the agency, with Coinbase saying it believes the enforcement “may involve a civil injunctive action” and that Coinbase “may seek other remedies.” The Coinbase Lend program is intended to pay customers a 4% interest rate on their holdings of the Coinbase-backed stablecoin USD Coin (CRYPTO:USDC). 

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