Crypto trading platform Coinbase has reportedly reached out to institutional clients about possible plans to set up a trading platform outside of the US, three people with direct knowledge told Bloomberg.
With crypto-friendly banks dwindling and regulatory scrutiny increasing, the potential move comes as no surprise. US regulators have been probing the platform’s nefarious dealings for years — the New York Department of Financial Services (NYDFS) slapped the firm with a $50 million penalty in January after an investigation found “long-standing failures” in its anti-money laundering compliance. According to NYDFS, these failures allowed serious criminals to move their crypto via the platform. Coinbase was also ordered to invest an extra $50 million in its compliance program.
Back in July, an investigation by the Securities and Exchange Commission (SEC) resulted in charging a former Coinbase manager, his brother, and his friend with insider trading. The SEC announced that same month it will open an investigation into the platform for potentially selling securities.
The San Francisco-born crypto trading firm has enjoyed a foothold in the US most can only dream of, including a US public listing. Its top execs have teased global expansion for a while now — after the recent failings of crypto-friendly banks Silvergate and Signature and growing anti-crypto sentiments in government, it feels like the right time for Coinbase to diversify.
That doesn’t mean the platform will be welcomed with open arms, however. Coinbase has already fallen into hot water with EU countries — most recently, the Dutch central bank imposed a $4 million fine on the firm for operating unregistered in the Netherlands for two years.
A spokesperson for Coinbase declined to comment to Bloomberg.