Monitors display Coinbase signage during the company's initial public offering (IPO) at the Nasdaq MarketSite in New York, U.S., on Wednesday, April 14, 2021.
Michael Nagle | Bloomberg | Getty Images
Coinbase has decided to halt its plans to launch an interest-earning product two weeks after CEO Brian Armstrong took the SEC to task on Twitter for its lack of guidance on the matter.
The newly public cryptocurrency services company said in an update on its blog Friday that it will not launch Coinbase Lend, which would allow users to earn a 4% annual percentage yield on the stablecoin USDC by allowing Coinbase to lend those funds to verified borrowers. Coinbase has also discontinued its waitlist for the product.
Coinbase shares fell 3.5% on Monday. The stock, which tends to follow cryptocurrency prices since its revenue is so closely tied to trading, has also been rocked by the broader crypto market sell-off. The price of bitcoin fell as much as 10% on Monday.
"We had hundreds of thousands of customers from across the country sign up and we want to thank you all for your interest," the post said. "We will not stop looking for ways to bring innovative, trusted programs and products to our customers."
A Coinbase spokesperson declined to comment beyond the content of the blog post. The SEC also declined to comment.
On Sept. 7 Armstrong suggested in a tweet storm that the Securities and Exchange Commission had been vague and seemingly unwilling to provide guidance and clarity for Coinbase, which had planned to launch the interest-earning product this month and then delayed it until October and made efforts in earnest to keep an open conversation with Washington. He also revealed the company had received a Wells notice from the SEC over the interest product, threatening to sue Coinbase if it decided to push through with the launch.
SEC Chairman Gary Gensler testified last week that the agency is taking a...