Coinbase Voices Privacy Concerns over US Treasury Regulations

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In Brief
  • Coinbase wants its users to respond to potential privacy regulations imposed by the US Treasury.

  • Coinbase is vocally opposed and wants them scaled back to protect user data.

  • The firm is preparing to go public in early 2021.

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Coinbase, one of the largest cryptocurrency exchanges globally, is speaking out against what it sees as unnecessary and unfair regulation from the US Treasury.

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According to a Dec 30 tweet, Coinbase seeks input from its users:

“The US Treasury is proposing crypto regs that will force exchanges to collect, store and share with the gov. personal information associated with all crypto transactions. If you believe this to be an intrusion of your privacy, please join us in sharing your concerns”

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Although Coinbase is a strictly regulated company, the collection of information from a governing body is, what many would argue, the antithesis of blockchain.

As Coinbase prepares for its 2021 IPO, it needs to remain in good standing with regulators while also prioritizing its customer’s needs.

Compliance From Coinbase

Coinbase has been a headliner of many crypto-based and general news outlets, most recently involving the SEC lawsuit against Ripple for its alleged unregistered XRP securities sales.

After the lawsuit was announced, some users are pointing fingers at Coinbase, claiming it is partially responsible. Coinbase has since decided to suspend trading in XRP on its platform, but that hasn’t been enough to protect it from a lawsuit.

With Messari predicting a potential $28 billion IPO valuation, Coinbase likely doesn’t want to do anything to undermine its reputation. The company recently filed its S-1 registration with the SEC, confirming that it will be going public.

With bitcoin prices trading near all-time highs, the launch of Ethereum 2.0, and the increased growth in DeFi, it appears to be the perfect atmosphere for an IPO, and it doesn’t want that undermined by having to supply user information.

Increased Enforcement

It doesn’t seem coincidental that more governing bodies are looking to regulate cryptocurrencies as they continue to grow. Governments worldwide have been debating tax increases on crypto users and forcing exchanges to hand over private information on users.

The US Treasury and other regulating bodies demanding this information usually claim this is for anti-money laundering purposes. But with Coinbase’s over 35 million customers, it’s difficult to say exactly what will be done with that information.

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Harrison is an analyst, reporter, and lead specialist at BeInCrypto based out of Tel Aviv, Israel. Harrison has been involved in the cryptocurrency space since late 2016 and is passionate about decentralized ledger technology and its potential.

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