There are historic cases of regulators allowing new modes of funding outside of traditional regulation, he said, mainly when there was a compelling need. For example, money market mutual funds became an alternative way for clients to generate returns during times of high inflation, when banks had restrictions on the interest they could provide.
Wilmarth sees no compelling need today.
Steven Lofchie, a transactions lawyer at Cadwalader, Wickersham & Taft LLP, said some people thought that “if you do something and it involves digital assets, you are outside of securities laws, and this is clearly not true “.
The authority of the SEC in the Coinbase affair has never been in doubt, he concluded. “There are difficult cases, this one is not one of them,” he said. In a blog post on his company’s website, he said the question was whether the company can borrow from retail investors without falling under securities laws. The answer is no, he said.
Kevin Werbach, professor of legal studies and business ethics at the Wharton School at the University of Pennsylvania, said the 4% offered by Coinbase is in line with some other crypto lending services, and even less than some platforms. decentralized financial systems.