Coinbase Under SEC Review – Here’s Why

Coinbase is once again under the regulatory microscope—this time for how it represented its user base during its 2021 public market debut. U.S. regulators are investigating whether the exchange’s “verified user” count, which once exceeded 100 million, gave investors a distorted view of its actual customer activity. The investigation , originally launched under the Biden administration and still active today, centers on the user metric highlighted in Coinbase’s registration documents for its direct listing on the Nasdaq. That figure was quietly removed from public reports two years later and replaced by a more refined “monthly transacting users” stat, which the company said better reflected platform engagement. Paul Grewal, the exchange’s top legal officer, confirmed the inquiry and called it outdated. He insisted that Coinbase had already disclosed its decision to retire the older metric and described the “verified user” count as broad—encompassing even those who had merely registered with an email or phone number. Although the SEC recently dropped a separate case accusing the company of operating as an unlicensed broker, this revived focus on past disclosures signals continued friction between the agency and one of the industry’s largest players. Meanwhile, Coinbase CEO Brian Armstrong recently revealed a security breach affecting customer identity data—adding to a volatile week for the company, whose stock price dipped 6.6% following the news. Reporter at Coindoo Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets. Related stories Next article !function(f,b,e,v,n,t,s){if(f.fbq)return;n=f.fbq=function(){n.callMethod?n.callMethod.apply(n,arguments):n.queue.push(arguments)};if(!f._fbq)f._fbq=n;n.push=n;n.loaded=!0;n.version='2.0';n.queue=[];t=b.createElement(e);t.async=!0;t.src=v;s=b.getElementsByTagName(e)[0];s.parentNode.insertBefore(t,s)}(window,document,'script','https://connect.facebook.net/en_US/fbevents.js');fbq('init','1188189499475368');fbq('track','PageView'); Source: https://coindoo.com/coinbase-under-sec-review-heres-why/