$4.7 Billion USDC Burned From Coinbase, Possible SEC Effect?

• PeckShield identifies $4.7 billion USDC burned from Coinbase.
• The movement is likely to be linked with the US crackdown on staking.
• Coinbase stock plummeted by 14.13% today.

Blockchain security and data analytics company PeckShield recently identified a $4.7 billion USDC burn from Coinbase alone. This was a follow-up to a $175 million USDC burn.

PeckShield believes it could possibly be due to the recent SEC crackdown on cryptocurrency staking. Rumors were out on the street that the U.S. Securities and Exchange Commission (SEC) is possibly planning to ban cryptocurrency staking.

The rumors started surfacing after SEC chairman Gary Gensler spoke about the possibility of classifying cryptocurrencies that allow staking to come under the securities. Coinbase CEO Brian Armstrong also took to Twitter to address the rumors.

Armstrong also mentioned that the SEC’s move could be terrible for US retail customers. The floating rumors, however, had an impact on Coinbase’s stock price. COIN dropped by 14.13% in value today. It is one of the biggest falls since July 26.

Earlier today, the SEC shut down the cryptocurrency staking program by Kraken where the exchange will pay $30 million for the settlement. Allegations were made that the exchange broke US rules with its cryptocurrency staking program. The agreement also pushed Kraken to discontinue staking in the US. The SEC also alleged that the exchange’s staking program was an illegal security sale.

Coinbase’s chief legal officer, Paul Grewal, commented on the situation:

What’s clear from today’s announcement is that Kraken was essentially offering a yield product. Coinbase’s staking services are fundamentally different and are not securities.

The SEC continues its crackdown on cryptocurrency, with the goal of eventually bringing the industry under its jurisdiction.