SEC raises concerns over Coinbase’s role in proposed Celsius plan

The SEC, in a Friday court filing, said it reserves its right to object to the plan from Celsius

article-image

CryptoFX/Shutterstock modified by Blockworks

share

The US Securities and Exchange Commission has opposed a plan from Celsius that sought to use Coinbase as a distribution agent for international customers. 

The SEC opposes the plan because they believe that the “Coinbase Agreements go far beyond the services of a distribution agent, contemplating brokerage services and master trading services that implicate many of the concerns raised in the SEC’s District Court action against Coinbase.”

Celsius filed for bankruptcy in July of last year.

The regulatory agency sued the US-based crypto exchange in June of this year, alleging that its staking service violated US securities laws and that it operated as an unregistered broker.

Additionally, the SEC took action against both Celsius and ex-CEO Alex Mashinsky in July. 

The SEC, in its lawsuit, accused the bankrupt crypto lender of misleading investors and raising billions through the “unregistered and fraudulent offers and sales of crypto asset securities.”

Read more: Celsius initiates bankruptcy proceedings to ‘stabilize’ its business

“The Debtors propose to engage Coinbase as Distribution Agent for international customers under the Plan and seek this Court’s approval of the Coinbase Agreements,” the filing continues. 

The proposed bankruptcy restructuring from Celsius, which will need Court approval, could tap Coinbase to provide brokerage services. 

The SEC noted, though, that the Celsius debtors “confirmed that they do not intend for Coinbase to provide brokerage services to the Debtors, despite the language in the Coinbase Agreements to the contrary.”

“There appears to be an additional agreement with Coinbase, which the Debtors seek to file under seal, but it has not been made available to the SEC staff,” the SEC added. 

The SEC argues further that, “to the extent there is a new agreement that accurately sets forth the arrangement with Coinbase (or if the agreement under seal is operative), it should be provided to this Court and to the SEC.”

The regulatory agency added that it “reserves its rights to object” without Celsius addressing the role that Coinbase will take. 

In response to the filing, Paul Grewal, Coinbase’s chief legal officer, tweeted, “Coinbase is proud to engage with Celsius to distribute crypto back to its customers. I wonder, why would the SEC object to a trusted US public company taking on this role?  We look forward to addressing this with the bankruptcy court and undertaking our important role to make Celsius customers whole.”

Updated Monday Sept. 25 at 12:58 pm ET: Added a quote from Paul Grewal, chief legal officer of Coinbase.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates.png

Research

The convergence of DePIN and energy generation aims to address modern grid challenges by incentivizing distributed generation.

article-image

Blockworks Research uses numbers to help crypto advance to a higher stage of storytelling

article-image

While Arizona’s governor could veto another crypto reserve bill, similar North Carolina and Texas laws are approaching the finish line

article-image

However, they noted there’s now an increased risk that unemployment and inflation will rise in the coming months. 

article-image

The network’s most ambitious upgrade since the Merge brings validator streamlining, smart account UX and doubled blobspace to Ethereum

article-image

Debate over extra Bitcoin use cases has returned, two years on from Ordinals