Coinbase Sets to Introduce Security Tokens
Estimated Reading Time: 3 minutes
Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 minutes to learn more
Coinbase is making a fresh attempt to bring security tokens to the U.S. market. Security tokens are digital assets that represent real-world investments, such as stocks or real estate but are traded on the blockchain. This move could change how traditional financial assets are bought and sold, making the process faster and more efficient.
Coinbase had originally explored this idea years ago but faced regulatory challenges. Now, with a new crypto task force in place and a changing attitude toward crypto in the U.S., the company sees another chance to make security tokens a reality.
Coinbase’s Past Efforts in Security Tokens
In 2020, Coinbase planned to launch its security token as part of its stock market debut. This would have allowed investors to trade shares in the company in a blockchain-based format. However, the U.S. Securities and Exchange Commission (SEC) failed approve the plan, therefore, Coinbase had to abandon the idea.
To this end, Alesia Haas, the company’s Chief Financial Officer, recently spoke about this at the Morgan Stanley TMT Conference. She mentioned that regulators were not open to security tokens at the time, and Coinbase faced many legal hurdles. However, she now believes there is renewed interest in blockchain-based financial products.
With the SEC’s new task force focusing on crypto, Coinbase hopes to restart conversations about security tokens. The company believes these tokens can improve the financial system by making transactions smoother and more transparent.
Coinbase’s Future Plans
Coinbase has been preparing for this opportunity for years. Its 2020 filings mentioned plans to support security tokens in the future. The company has also created guidelines to help developers navigate crypto regulations and set up monitoring programs to track digital assets.
Recently, Coinbase faced legal challenges from the SEC, which accused it of operating without proper registration. The company has argued that crypto regulations are unclear and successfully appealed the case. Meanwhile, Coinbase CEO Brian Armstrong will attend a crypto summit with President Donald Trump, where tokenized securities will likely be discussed. Armstrong believes these assets could bring major benefits, such as 24/7 trading, and make financial markets more accessible to everyone.
In order to place winning trades with us via Bybit, you can open an account here.