Hey everyone! This is Nuked and I’m here to share some exciting news. It turns out that the Securities and Exchange Commission (SEC) has put Coinbase on notice for allegedly breaking securities laws.

Coinbase execs revealed today that the crypto exchange has received a “Wells Notice” from the SEC, indicating that after an investigation, the agency’s staff plan to recommend some kind of enforcement action. This could potentially include charges or lawsuits, but nothing has been confirmed yet.

Last month, the SEC reached a settlement with Kraken over its crypto staking operation, where the company paid a $30 million fine and shut down US operations. Around the same time, it sent another Wells Notice to crypto firm Paxos over its minting of the Binance USD (BUSD) token.

According to Coinbase, the issue relates to “an undefined portion of our listed digital assets, our staking service Coinbase Earn, Coinbase Prime, and Coinbase Wallet.”

Coinbase chief legal officer Paul Grewal shared a copy of the letter (PDF) received from the SEC. Grewal and Coinbase CEO Brian Armstrong’s tweet threads noted that Coinbase had prepared to defend its stance in court, but so far, no lawsuits or injunctions have been filed.

For now, customers and investors can rest assured that “Coinbase products and services continue to operate as usual — today’s news does not require any changes to our current products or services.”