Mark Cuban slams the SEC and says the Coinbase suit shows why no one trusts them
The billionaire investor said on Twitter that the SEC could have "easily" helped Coinbase get into compliance, but chose to sue the exchange instead.
Rick Bowmer/AP Images
- Mark Cuban slammed the SEC's decision to sue Coinbase this week.
- The famed investor said the regulator could have helped the exchange comply instead of sue.
- The SEC this week sued Coinbase and Binance for allegedly operating illegally in the US.
Mark Cuban criticized the Securities and Exchange Commission's decision to sue Coinbase this week for allegedly operating an illegal exchange, claiming that the regulator could have helped it comply but instead chose to file its lawsuit.
The billionaire investor posted on Twitter that the "fundamental problem" of the agency is that it doesn't actually want to help firms follow the rules.
"They don't want to help companies get to compliance they want to challenge them to get to compliance," Cuban wrote. "They are full of lawyers. Lawyers want to litigate."
He went on to say that the SEC prefers to take legal action to protect the jobs of the lawyers that the agency employs.
The SEC didn't immediately respond to Insider's request for comment.
On Tuesday, the SEC unveiled its lawsuit against Coinbase, a day after it sued Binance and its CEO, Changpeng Zhao.
In both cases, it alleged that the companies are operating illegally, and challenged virtually their entire business operation in the US. The cases, sources told Insider, are "existential" matters for both companies.
SEC Chair Gary Gensler has long held that most cryptocurrencies are securities, and the lawsuits this week are a culmination of his views over the past few years that crypto needs to comply with regulations.
Cuban also claimed in his post that the SEC evaluates its own success based on the number of cases it brings and wins, rather than the number of companies it helps comply with the rules. The latter, he said, would have a much greater impact on investor protections and rooting out bad actors.
"As it is, no one wants to talk to the SEC because no one trusts them for fear of being in the same situation as @coinbase finds itself," he wrote.