The CEO of Coinbase said the company would shut down Ethereum staking if regulated

The crypto sector is witnessing a slew of ongoing and upcoming milestone events. It is rumored that the Merge, for instance, will jiggle market sentiment in the coming days and be scrutinized by regulators in the coming months.

As Coinbase CEO Brian Armstrong has stated, if any regulatory threats shadow Ethereum's post-Merge operations, the company will simply shut down Ethereum stake services to ensure that the blockchain remains secure.

The Ethereum Merge update will switch its mining model from the power-intensive Proof-of-Work model to the more energy-efficient Proof-of-Stake model, reducing its energy requirements by 99.95 percent.

As the Merge launches in September, social media has been flooded with a discussion about Coinbase's plans. Cofounder Armstrong responded to one Twitter conversation involving the Merge to explain the company's plans. 

What is the best way to preserve network integrity if regulators ask you to censor at the Ethereum protocol level with your validators? Will you comply and censor at the protocol level, or will you shut down the staking service? ”

When Ethereum transitions to a PoS mining model, more people will be able to join the network as its transaction validators. Armstrong claimed that Coinbase would ensure Ethereum's integrity and halt staking services.

The people who are interested in participating will be needed to lock up a certain amount of ETH tokens on the blockchain to become validators and take on the responsibilities of storing data, processing transactions, and adding new blocks to the network in return for rewards.

The developers are conducting extensive tests on the revamp of Ethereum, and this is because Defi apps, whose market value is reportedly over $100 billion, run on the blockchain.

As of today, the crypto sector is still struggling to overcome inquiries related to mixers such as Tornado Cash as well as back-to-back hack attacks. Globally, governments have tightened scrutiny around this sector to protect their citizens.

Against this backdrop, the release of the Merge may face overprotective sentiments from lawmakers. At the same time, crypto firms like Coinbase are already figuring out what to do.