KEY POINTS
- Coinbase left Hawaii in 2017 amid stringent requirements for crypto firms seeking to operate in the state
- The crypto giant has returned after the state said crypto firms no longer need to obtain a money transmitter license
- Coinbase's Shirzad welcomed the state's regulatory updates that he said aligned with the exchange's goals
Coinbase has returned to Hawaii, seven years after exiting the state, providing residents with a suite for cryptocurrency services that residents can enjoy, including staking and international digital asset transfers.
Why did Coinbase leave?
Coinbase, one of the world's top cryptocurrency exchanges, left Hawaii early in 2017, citing "impractical" financial regulations that the Hawaii Division of Financial Institutions (DFI) communicated with the company at the time.
Hawaii previously signaled that it was aiming to establish "educated" blockchain legislation. It then required crypto firms to not only obtain a money transmitter license, but also to hold enough fiat reserves to cover the amount of cryptocurrencies held.
Why is Coinbase back?
After more than seven years out of Hawaii, Coinbase announced today that it back in the Aloha State, citing "recent state regulatory changes" that paved the way for its services to once again be offered for Hawaii residents.
The announcement came after the local Department of Commerce and Consumer Affairs (DCCA) notified the public late in June that crypto companies no longer need to obtain a money transmitter license to conduct business in Hawaii. On the other hand, "digital currency companies" still need to comply with "any applicable federal licensing or registration requirements."
"For years, Hawaii residents have expressed a strong interest in crypto on Coinbase, the only publicly traded crypto exchange in the U.S., and we're excited to deliver on that promise today," Faryar Shirzad, Coinbase's chief policy officer, said in a statement.
Shirzad said Coinbase welcomes the DCCA's "innovative, responsible approach" to regulation that "aligns with our goal of providing a safe and compliant environment for all."
What should Hawaii residents expect?
With Coinbase's re-entry into the Aloha State, residents can now buy, sell, and manage their crypto assets. New customers can get started with Coinbase in just a few minutes. Users will now have access to a vast trove of cryptocurrencies. They can also set up recurring buys, earn rewards, track digital asset prices, and conduct cross-border transfers.
Customers in Hawaii will also have access to staking, where they can earn up to 12% APY in staking rewards on some of the most popular assets on the exchange. By just holding $USDC, eligible users can also earn up to 5.20% in rewards.
Coinbase's rewards rate is based on the estimated protocol rate, and is subject to change. The latest applicable rates will appear directly on user accounts. For staking, the feature is only available in eligible jurisdictions and for eligible networks.
"The launch in Hawaii fuels the excitement for the crypto industry's continued growth, and we are pleased to bring the power of crypto to more people and places. This is just one step in our mission to increase economic freedom around the world," Shirzad added.
Fighting for regulatory clarity
Coinbase is known for being a pioneer of the movement for crypto regulatory clarity. Over the years, it has battled with the U.S. Securities and Exchange Commission (SEC) for clearer rules dedicated for the digital assets space.
Today we are asking the Court to order @SECGov to produce important documents in discovery, including documents related to the tokens the SEC included in its complaint against @coinbase, the SEC’s consideration of our public offering, and statements Chair Gensler has made in his…
— paulgrewal.eth (@iampaulgrewal) July 23, 2024
Just recently, it sought more discovery documents from the Wall Street regulator that should help build its defense in a case filed by the SEC in mid-2023 over Coinbase's alleged offering of unregistered securities.
It is also collaborating with the Stand With Crypto movement that seeks to make crypto's voice be heard by lawmakers across the country.
