Bitcoin exchange Coinbase has paused its retail staking service in California, New Jersey, South Carolina, and Wisconsin after those states announced they would require adjustments to those services while its legal procedures against such staking services proceed. Cryptocurrency staked before the orders were issued will be unaffected.
The SEC filed a lawsuit against Coinbase last month, characterising its staking service and several of the tokens it lists as securities. On the same day, securities regulators in ten states initiated their own proceedings against Coinbase.
“We strongly disagree with any allegation that our staking services are securities,” Coinbase wrote in a recent blog post. “But we will fully comply with the preliminary state orders where required, even though that comes before we’ve had an opportunity to defend ourselves.”