Major U.S.-based cryptocurrency exchange Coinbase Global Inc. (NASDAQ:COIN) launched interest-earning features based on decentralized finance (DeFi) protocols. But, the U.S. is left out of the project.
What Happened: Coinbase announced it is “making DeFi more accessible” by releasing the feature in more than 70 countries, allowing users to earn interest by lending out their DAI stablecoin holdings with no fees, lockup periods and an easy setup, according to a Thursday Decrypt report. The initiative aims to make DeFi “more customer-friendly and approachable.”
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The interest earned through the feature is variable, but Coinbase believes “DeFi has tremendous potential to help increase economic freedom.” The U.S. is not among the 70 countries where the product will be available — at least for now.
The report follows early September reports about Coinabse CEO Brian Armstrong describing the behavior of the U.S. Securities and Exchange Commission (SEC) as “sketchy” after the regulator threatened to sue the exchange if it launched a previously announced interest-bearing system based on lending.
Armstrong claimed the firm gave the SEC a “friendly heads up and briefing” before announcing the product, to which the regulator answered by saying that the “lend feature is a security.” Armstrong commented, “How can lending be a security?”
The actions that the SEC is taking against crypto lending and interest-earning platforms are the most probable reason why this product was not launched in the U.S.
Photo: Courtesy Coinbase
