Coinbase announced on October 17, 2023, that it would temporarily suspend support for a substantial number of non-USD trading pairs, including USDT, EUR, BTC, GBP, and ETH. This decision, coming two weeks after its initial announcement, has raised several questions about the exchange’s intentions and the potential ramifications for traders and investors.
A total of 80 non-USD trading pairs across Coinbase’s platforms, including Coinbase Exchange, Advanced Trade, and Coinbase Prime, have been affected by this decision. These pairs encompass 28 with USDT, 23 with EUR, 20 with BTC, 8 with GBP, and 1 with ETH.
ACH-USDT, AGLD-USDT, ARPA-EUR, ARPA-USDT, AUCTION-EUR, AUCTION-USDT, BADGER-EUR, BADGER-USDT, BAND-BTC, BAND-EUR, BAND-GBP, BNT-BTC, BNT-EUR, BTRST-BTC, BTRST-EUR, BTRST-USDT, C98-USDT, CTSI-BTC, DESO-USDT, ELA-USDT, ERN-USDT, FORTH-BTC, FORTH-EUR, GAL-USDT, HFT-USDT, IDEX-USDT, IOTX-EUR, KNC-BTC, KSM-USDT, LCX-EUR, LCX-USDT, LQTY-EUR, LQTY-USDT, METIS-USDT, NKN-BTC, NKN-EUR, NKN-GBP, NMR-BTC, NMR-EUR, NMR-GBP, OGN-BTC, PERP-EUR, PERP-USDT, POND-USDT, POWR-EUR, POWR-USDT, RAD-BTC, RAD-EUR, RAD-GBP, RAD-USDT, REN-BTC, REQ-BTC, REQ-EUR, REQ-GBP, REQ-USDT, RLC-BTC, SKL-BTC, SKL-EUR, SKL-GBP, SPELL-USDT, STORJ-BTC, SUPER-USDT, SUSHI-BTC, SUSHI-ETH, SUSHI-EUR, SUSHI-GBP, TRAC-EUR, TRAC-USDT, TRU-BTC, TRU-EUR, TRU-USDT, UMA-BTC, UMA-EUR, UMA-GBP, XYO-EUR, XYO-USDT, ZEN-BTC, ZEN-USDT, ZRX-BTC, ZRX-EUR.
The suspension of trading went into effect at 02:30 AM, Vietnam time, on October 17, 2023. Notable among the suspended pairs are ACH-USDT, BAND-BTC, LCX-EUR, and many more.
Of particular significance is the fact that three tokens listed in the affected pairs have previously been declared securities by the U.S. Securities and Exchange Commission (SEC). These tokens include Power Ledger (POWR), XYO Network (XYO), and Liechtenstein Cryptoasset Exchange (LCX). Their inclusion in the list raises concerns about Coinbase’s adherence to regulatory compliance and the potential implications for these tokens.
Coinbase has stated that the reason behind the temporary suspension is to “improve the overall health of the market and enhance liquidity.” It has also mentioned that Coinbase Advanced Trade users in eligible regions (although not specified) can continue trading these assets with USD or USDC pairs.
One plausible motive behind the move is Coinbase’s attempt to bolster the utility of USDC, a stablecoin co-issued by the exchange in partnership with Circle. Enhancing the role of USDC can strengthen Coinbase’s stablecoin offerings and potentially improve liquidity within its platform.
This announcement of Coinbase’s suspension of a large number of trading pairs has drawn parallels with a previous incident involving “rival” exchange Binance.US. In June 2023, Binance.US delisted 102 spot trading pairs just two days after being sued by the U.S. Securities and Exchange Commission (SEC). The SEC’s lawsuit accused Binance.US of violating U.S. securities regulations related to its trading and staking operations.
It’s worth noting that Coinbase has also faced legal challenges from the SEC, resulting in a demand for the suspension of trading activities related to various cryptocurrencies. However, Bitcoin is the notable exception, a reflection of the SEC Chairman’s assertion that “only Bitcoin is not a security,” while other digital assets may be considered as such.
The Coinbase incident underscores the evolving regulatory landscape within the cryptocurrency industry and the need for exchanges to adapt and comply with the changing rules and standards. As the crypto market continues to mature and face increased scrutiny from regulators, the suspension of non-USD trading pairs by Coinbase raises questions about the exchange’s commitment to regulatory compliance and how these changes may impact the wider cryptocurrency ecosystem.
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