coinbase rocked with sec probe

In a shocking news announcement, Coinbase appears to be under a Wells notice from the SEC, which means the SEC is going to take Coinbase before a court over what it is doing with cryptocurrency.

Wells Notice and CEO Sells Millions of Shares

What's even more interesting is that CEO, Brain Armstrong, sold millions in $COIN shares yesterday just before this announcement and today, the stock has fallen 15%.

Brian Armstrong, CEO of Coinbase, made a Tweet thread to respond to this Wells notice as follows:

Coinbase "Adhering to Law"

He seems confident that Coinbase is doing no wrong and that it will show governments and regulators what it is doing, and is hopeful that Coinbase will be able to work with them.

Something funny about this was that someone asked a question on his Tweet thread to explain this in NFL terms (basically, make this simple to understand), and Brian Armstrong responded with this (I am paraphrasing):

"Imagine a pickleball game with a soccer and football referee. The refs can't agree on the rules of pickleball, and they decide to change a call they made way back in April 2021."

What Actually Happened

Brian Armstrong is arguing that his company is doing nothing wrong, and many think that the SEC is just trying to gain the upper hand against cryptocurrency. There will definitely be more development with this as time goes on.

Coinbase is fighting an uphill battle against governments and regulators because cryptocurrency itself is a threat to the currency of government. I think as long as Coinbase is doing right by its customers and adhering to the law, there shouldn't be any issue here. Still, the stock plunged 15% regardless.

What do you think is going on here? Is Coinbase doing something illegal here?