Coinbase said the notice, which is essentially a formal intention to sue, is linked to the company's plans to allow users on its platform to earn interest by lending their cryptocurrency assets- a program it calls 'Lend'.
"Despite Coinbase keeping Lend off the market and providing detailed information, the SEC still won’t explain why they see a problem," Coinbase's chief legal officer, Paul Grewal, wrote in a blogpost late Wednesday. "Rather they have now told us that if we launch Lend they intend to sue. Yet again, we asked if the SEC would share their reasoning with us, and yet again they refused."
Brian Armstrong, Coinbase's CEO, tweeted out a thread calling the SEC's behavior "sketchy."
Jim Cramer notes that Gary Gensler, SEC chair, "taught crypto at MIT" so he doesn't necessarily need to be schooled in it.
"[Coinbase] is declaring war against a man who has unlimited firepower," Cramer said of Armstrong's thread.