- Coinbase has terminated Algorand’s staking rewards.
- Despite the development, ALGO did not experience negative impacts.
The latest victim of the SEC’s continuous crackdown on multiple exchanges may be Algorand [ALGO]. According to a recent notification, ALGO stakes will no longer be eligible for incentives from Coinbase.
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The ripple effect of Coinbase’s notice
On 22 March, Staci Warden, CEO of the Algorand Foundation, announced that Coinbase had terminated ALGO staking rewards. Moreover, Coinbase would no longer promote ALGO incentives for retail users, since the company was reassessing its offerings in light of increased regulatory scrutiny.
Hi #algofam, woke up this a.m, like many of you, to find that @coinbase killed rewards. They've now informed us that they are evaluating their services in light of recent regulatory scrutiny, and, for that reason, they will no longer support Algo rewards for Retail customers. 1/
— staci.algo (@StaciW_DC) March 22, 2023
U.S.-based cryptocurrency exchange and staking provider Coinbase revealed late Thursday that the SEC had accused it of violating securities laws by providing staking services. The regulator issued a “Wells Notice” to Coinbase, warning the company that it intended to take action soon.
With Algorand, Coinbase had fulfilled the service provider role by mediating between the protocol and its users and dispersing the staking rewards.
The state of Coinbase and Algorand stakes
The SEC has indicated that it would take action against Coinbase’s spot market, staking service, Coinbase Prime, and Coinbase Wallet in the Wells notice accompanying such action. Coinbase responded on 22 March, saying that it had prepared papers and given two witnesses for testimony, one on the basic features of its staking services and one on the basic operation of its trading platform.
Also, support will be offered to Algorand users who wish to take an active role in governance in the form of individual governors. In addition, they will keep providing ALGO trading to all customers and Governance Rewards to their institutional investors.
Algorand (ALGO) staking stats
According to data from staking rewards, 51.92% of ALGO was staked. The entire market cap was over $1.5 billion, while the staked ALGO’s market cap was above $836 million. According to CoinMarketCap, over seven billion coins were in circulation. Also, the volume has decreased by over 30% during the past 24 hours.
Realistic or not, here’s ALGO market cap in BTC’s terms
ALGO price movement
The price trend of ALGO on a daily timeframe revealed that it had fluctuated recently between gains and losses. It was trading at about $0.21, up almost 1% as of this writing. The most recent development did not affect its price movement.
Source: TradingView
As with Algorand, staking services on exchanges may be shut down if there is increased regulatory oversight. U.S. investors might be barred from participating in staking and other services if the regulatory landscape does not improve.
