Coinbase, one of the largest cryptocurrency exchanges, has entered into a tug of war with the US Securities and Exchange Commission (SEC) over regulatory clarity for cryptocurrencies on US soil. Coinbase has filed a lawsuit to force the SEC to respond to its petition calling for clear rules to operate under optimal conditions.
Coinbase attacks SEC head on
Coinbase’s never-ending battle with the US Securities and Exchange Commission (SEC) should soon lead to something concrete. Brian Armstrong’s exchange has filed a lawsuit against the SEC over regulatory clarity for cryptocurrencies in the US.
More specifically, Coinbase wants to force the SEC to respond to its petition from last July, which literally asked for more rules so that it could operate under optimum conditions. To date, the SEC has not deigned to respond to this petition, even though its director, Gary Gensler, is constantly attacking the various players in the industry, whom he accuses of not respecting the law.
Today, we filed a narrow action in the U.S. Circuit Court to compel the SEC to respond “yes or no” to a rulemaking petition we filed with them last July asking them to provide regulatory guidance for the crypto industry. 1/4 https://t.co/rlsS1DIFfl
– paulgrewal.eth (@iampaulgrewal) April 25, 2023
According to Paul Grewal, Coinbase’s legal director, the SEC has already rejected the petition in question while increasing sanctions against various crypto players in the United States such as Kraken and Paxos, to name but a few, which makes no sense :
“Based on the SEC’s public statements and enforcement activities in the cryptocurrency industry, it appears that the SEC has already decided to reject our petition. But it has not yet informed the public. Thus, the action Coinbase filed today simply asks the court to direct the SEC to share its decision. “
The SEC is lost in its own fog
Interviewed by the Financial Services Commitee on 18 April, Gary Gensler, usually so quick to describe all crypto-currencies as “securities”, found himself somewhat embarrassed when asked to clearly determine whether or not Ether (ETH) was indeed a security and not a commodity. In fact, he simply couldn’t answer, and simply dodged the question for more than 2 long minutes.
This attitude only serves to highlight the regulatory confusion in which the SEC itself finds itself, despite the fact that the majority of players are open to dialogue with the regulator.
Jesse Powell, the founder of Kraken, accused the SEC of deliberately targeting only the good players in order to hinder their development, while letting the ‘bad’ companies evolve, such as FTX, which, given the track record of its new management, should have been nailed a long time ago for a number of shortcomings.
This openness to dialogue was reiterated in Coinbase’s press release by Paul Grewal:
“We are pleased to announce that we have agreed to a new agreement with FTX.
“So until the crypto industry gets this clarity, we will continue to take all steps available to us to get it, which includes today’s filing. We also remain available to the SEC and all of our regulators for dialogue on these issues at any time.”
