Michael Bacina explained in an interview that the scrutiny may cause a “serious and chilling” impact on trading protocols and related token programs.
A news article by Bloomberg disclosed that the exchange protocol Coinbase is under scrutiny from the Securities and Exchange Commission to ascertain if it permits US shareholders to exchange properties that should be enlisted as securities.
The news article further clarified that these investigatory activities are being done independently from the July 21st scrutiny regarding a suspected insider exchange scheme.
Australian virtual property attorney Michael Bacina has highlighted in a Cointelegraph meeting that the likely scrutiny could affect digital exchanges allowing programs to push through, notwithstanding if the tokens are eventually tagged as securities.
He further noted that the “actions by the SEC would be seen aligned with encouraging pro-active industry engagement; Coinbase has a history of good faith engagement on regulatory matters and has indicated the SEC has reviewed their token listing criteria.”
Bacina also pointed out that the investigation could cause the exchange to “face very substantial fines” or would be instructed to file for a license that enlists it as a trading protocol in the United States.
The platform has repeatedly refuted claims of including securities on its list of tradable assets. Paul Grewal, the legislative chair of the exchange, dropped a tweet on July 25, reaffirming his “confidence” in Coinbase’s strict and committed effort to exclude securities from its exchange operation.