{"id":554925,"date":"2023-02-22T06:46:48","date_gmt":"2023-02-22T03:46:48","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/coinbase-staking-fundamentally-different-to-krakens-chief-lawyer\/"},"modified":"2023-02-22T06:46:48","modified_gmt":"2023-02-22T03:46:48","slug":"coinbase-staking-fundamentally-different-to-krakens-chief-lawyer","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/coinbase-staking-fundamentally-different-to-krakens-chief-lawyer\/","title":{"rendered":"# Coinbase staking &#8216;fundamentally different\u2019 to Kraken&#8217;s \u2014 chief lawyer"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3ca6d7b024f\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3ca6d7b024f\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/coinbase-staking-fundamentally-different-to-krakens-chief-lawyer\/#%E2%80%9D_Coinbase_staking_%E2%80%98fundamentally_different_to_Krakens_%E2%80%94_chief_lawyer_%E2%80%9C\" >&#8221; Coinbase staking &#8216;fundamentally different\u2019 to Kraken&#8217;s \u2014 chief lawyer &#8220;<\/a><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Coinbase_staking_%E2%80%98fundamentally_different_to_Krakens_%E2%80%94_chief_lawyer_%E2%80%9C\"><\/span>&#8221; Coinbase staking &#8216;fundamentally different\u2019 to Kraken&#8217;s \u2014 chief lawyer &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<p><img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjMtMDIvMDZjOTYyMDUtMGM0Ni00YTFhLTg2ZTAtOTIyMGVjNGJlOGJmLmpwZw==.jpg\" \/><\/p>\n<div class=\"post-content\" data-v-48054ca8>The staking services offered by cryptocurrency exchange Coinbase are \u201cfundamentally different\u201d to what was offered by its peer exchange Kraken \u2014 which recently came under fire from the United States securities regulator \u2014 according to Coinbase&#8217;s head lawyer.<\/p>\n<p>Paul Grewal, Coinbase\u2019s chief legal officer, made the comments in his response to a shareholder question regarding its staking services during a Q&amp;A session on the exchange\u2019s fourth-quarter results, noting:<\/p>\n<blockquote><p>\u201cThe staking products that we offer on Coinbase are fundamentally different from the yield products that were described in the reinforcement action against Kraken. The differences matter.\u201d<\/p><\/blockquote>\n<p>The first point of difference Grewal highlighted was that Coinbase users retain ownership of their cryptocurrencies at all times.<\/p>\n<p>In its user agreement last updated Dec. 15, 2022, Coinbase <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.coinbase.com\/legal\/user_agreement\/united_states\">states<\/a> that it merely \u201cfacilitate[s] the staking of those assets on your behalf,\u201d but may not replace any Ether (ETH) lost to slashing \u2014 which refers to the blockchain&#8217;s mechanism for punishing bad behavior by reducing a validator\u2019s tokens.<\/p>\n<p>Grewal also suggested that another difference was its customers have a \u201cright to the return,\u201d with the firm unable to \u201csimply just decide not to pay any returns at all.\u201d<\/p>\n<p>He pointed to the exchange&#8217;s registration as a publicly-traded company as another critical point of difference, which enables customers to have \u201cdeep transparent insight into our financials.\u201d<\/p>\n<p>In comparison, the Securities and Exchange Commission&#8217;s (SEC&#8217;s) complaint against Kraken alleged its users lost control of their tokens by offering them to Kraken&#8217;s staking program and investors were offered &#8220;outsized returns untethered to any economic realities&#8221; with Kraken also able to pay &#8220;no returns at all.\u201d<\/p>\n<p>Grewal however reiterated calls for regulatory clarity on staking services in the U.S. suggesting the SEC was outlining their expectations in court complaints rather than through clear regulations, noting:<\/p>\n<blockquote><p>\u201cRules making clear these distinctions would provide very real clarity and we think the public shouldn&#8217;t have to parse complaints in federal court in order to understand what a regulator expects.\u201d<\/p><\/blockquote>\n<p><strong>Related: <\/strong><strong><em>Coinbase beats Q4 earnings estimates amid falling transaction volume<\/em><\/strong><\/p>\n<p>In a Feb. 13 tweet, Grewal had opined that staking in itself was not a security transaction, using an analogy of harvesting oranges to elaborate on his position.<\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">If I grow oranges myself and harvest them myself, the oranges are not securities. If I grow oranges myself and  harvest them using a contractor that charges me a fee, the oranges are still not securities.<\/p>\n<p>\u2014 paulgrewal.eth (@iampaulgrewal) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/iampaulgrewal\/status\/1625266455704141824?ref_src=twsrc%5Etfw\">February 13, 2023<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>On the back of SEC Chair Gary Gensler calling on firms to register products with the regulator, Grewal indicated that Coinbase has no issues registering products with the SEC where \u201c<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ropriate,\u201d but added:<\/p>\n<blockquote><p>\u201cI think it&#8217;s fair to say that at this point in time, the path to registration for products and services that may qualify as securities has not been open, or at least readily or easily open.\u201d<\/p><\/blockquote>\n<p>Coinbase is currently facing an SEC investigation into its products similar to the one that resulted in Kraken settling with the regulator for $30 million and being prohibited from offering staking services to its U.S. clients.<\/p>\n<p>Coinbase intends to put up a fight, however, with CEO and co-founder, Brian Armstrong, suggesting the company would be willing to challenge the regulator and take the matter to court.<\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">Coinbase&#8217;s staking services are not securities. We will happily defend this in court if needed.<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/GtTOz77YV3\">https:\/\/t.co\/GtTOz77YV3<\/a><\/p>\n<p>\u2014 Brian Armstrong (@brian_armstrong) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/brian_armstrong\/status\/1624829368915890176?ref_src=twsrc%5Etfw\">February 12, 2023<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/coinbase-staking-fundamentally-different-to-kraken-s-chief-lawyer\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Coinbase staking &#8216;fundamentally different\u2019 to Kraken&#8217;s \u2014 chief lawyer &#8220; The staking services offered by cryptocurrency exchange Coinbase are \u201cfundamentally different\u201d to what was offered by its peer exchange Kraken \u2014 which recently came under fire from the United States securities regulator \u2014 according to Coinbase&#8217;s head lawyer. Paul Grewal, Coinbase\u2019s chief legal officer,&#8230;<\/p>\n","protected":false},"author":1,"featured_media":554926,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/s3.cointelegraph.com\/uploads\/2023-02\/06c96205-0c46-4a1a-86e0-9220ec4be8bf.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74957,74956,74860,74891,75540,74898,133582,135119,117,71433,70934,67874],"class_list":["post-554925","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-brian-armstrong","tag-coinbase","tag-cryptocurrency-exchange","tag-ethereum","tag-kraken","tag-sec","tag-staking","tag-validator","tag-business","tag-court","tag-regulation","tag-united-states"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/554925","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=554925"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/554925\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/554926"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=554925"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=554925"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=554925"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}