Coinbase Compliance Chief Resigns

The Washington Free Beacon reports that the Chief Compliance Officer of Coinbase has resigned. Chief Compliance Officer Martine Niejadlik resigned Coinbase after spending a bit more than a year with the organization. The Free Beacon notes that recently investors and regulators have been critical of Coinbase's "outreach" efforts where Coinbase has noted that Bitcoin does not respect international sanctions as well as Coinbase's failure to definitively achieve licensing in every US state it claims to operate.

2 thoughts on “Coinbase Compliance Chief Resigns

  1. The investor presentation says "Immune to country-specific sanctions (e.g. Russia-Visa)". I was not aware that Visa had any problems in Russia, but after some googling, it seems that Russia cut off Visa's rights to process payments in Russia as a punishment for US sanctions. Visa eventually worked out a deal with Russia that allowed it to resume processing payments, but only after "partnering" with a local bank. Thus, giving Coinbase the benefit of the doubt, they may have intended to communicate to investors that Coinbase would not be susceptible to the same local pressure as Visa was. Since clearly, Coinbase would never try to help people evade sanctions! (I hope?)

    Also giving Coinbase the benefit of the doubt on their claims of regulatory compliance even in a couple states where they aren't licensed as money transmitters, it is possible that they received some verbal reassurance from NYDFS staff that they need not apply for an MT license while the Bitlicense regs are being promulgated. Speaking from my limited experience dealing with NY corporate and securities regulators, it's often necessary to read between the lines to some extent, given the sometimes contradictory provisions of our state laws and regs. However, Coinbase is not able to reveal if they have received such verbal guidance, since doing so would destroy their relationship with an important regulator.

    At the end of the day, while I still think Coinbase is a risky business due to holding the bitcoins of its customers, I feel like these criticisms of their regulatory compliance and consumer outreach are mostly FUD.

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