- Coinbase has paused staking services in four U.S. states, including California and New Jersey.
- The suspension comes a month after ten states initiated proceedings against the exchange over its staking product.
- CEO Brian Armstrong previously assured customers that the staking services would continue despite objection from state regulators.
- The company’s share price has tanked more than 9% following the latest development.
Coinbase’s shares have lost more than 9% of their value following the pausing of its staking services in multiple U.S. states. The pause comes more than a month after ten states initiated proceedings against the crypto exchange on the same day that the Securities and Exchange Commission sued it for allegedly operating an unregistered securities exchange and offering unregistered securities through its staking service.
Coinbase Says It Will Defend Its Staking Services
Coinbase took to Twitter earlier today to share the latest development regarding the staking services with its customers. According to the crypto exchange, which happens to be the largest in the United States, regulators in California, New Jersey, South Carolina, and Wisconsin have required it to stop offering its staking product. The state regulators directed the exchange to prevent retail customers from staking additional crypto assets while their proceedings continue. Coinbase has stated that it disagrees with the allegations surrounding its staking services and added that it will vigorously defend the product in court.
We stand by staking. Today almost every major blockchain relies on staking because it is open, secure, and environmentally friendly. Americans in every state deserve access to the same technology and economic opportunities as people everywhere.”
The latest order by state regulators led to a 9% decline in Coinbase’s share price. The stock dropped from its daily high of $113 to as low as $101 before closing at $105. Chief Executive Officer Brian Armstrong previously assured customers that the enforcement action by the SEC and the proceedings initiated by state regulators wouldn’t impact the staking services. “We’re not going to wind down our staking service. Coinbase’s staking product is architected and built in a way to be compliant,” he stated at the time.