SEC investigates whether Coinbase exaggerated user numbers before its 2021 IPO

According to The Block, the US Securities and Exchange Commission (SEC) is investigating whether Coinbase falsified user data before going public in 2021. The SEC focuses on examining the "100 million verified users" metric claimed by the exchange in its direct listing registration documents, which was quietly discontinued two years later. Paul Grewal, Chief Legal Officer of Coinbase, responded that this is an investigative matter left over from the previous government, and the relevant indicators were discontinued and fully disclosed two and a half years ago. In 2023, Coinbase stated in its securities filing that it will replace the "verified users" metric with "monthly trading users", stating that the latter includes inactive users who only verify email or phone numbers and cannot truly reflect business performance. But in 2022, CEO Brian Armstrong still publicly claimed that the platform has 103 million verified users, emphasizing its position as the largest cryptocurrency trading platform in the United States. This investigation was initiated during the Biden administration and continued to advance during the Trump administration. It is worth noting that the SEC has recently withdrawn a separate lawsuit against Coinbase for "unlicensed brokerage business".