Shares of Coinbase (COIN) are down 13% after regulators warned the cryptocurrency exchange that it has identified potential violations of U.S. securities laws.
Specifically, the U.S. Securities and Exchange Commission (SEC), which oversees Wall Street, has issued Coinbase with a “Wells notice” that is usually one of the final steps before the regulator formally issues charges against a publicly traded company.
The SEC has ramped up its enforcement of the cryptocurrency industry this year following the $8 billion U.S. collapse last November of the FTX exchange.
In recent months, the SEC has filed charges against crypto companies and projects that it claims are selling unregistered securities, particularly stablecoins.
Coinbase described the current SEC investigation as “cursory,” and said the Wells notice it has received contains little information about potential violations and charges.
The company added that it plans to continue operating as usual despite the ongoing SEC investigation.
Coinbase’s stock has declined 58% over the last 12 months to $77.14 U.S. per share.
