Coinbase Challenges SEC In Court Battle
San Francisco-based crypto exchange Coinbase is making strategic moves to gain an advantage in its ongoing legal battle with the U.S. Securities and Exchange Commission (SEC). In response to the commission’s request for an additional 120 days to reply to its rulemaking petition, Coinbase has filed a solid response in the U.S. Court of Appeals for the Third Circuit.
The Court should grant mandamus now because the Commission has decided not to grant Coinbase’s rulemaking petition and Is actively harming the industry. 2/5 pic.twitter.com/O40x9qEBK6
— paulgrewal.eth (@iampaulgrewal) June 17, 2023
Swift Action against SEC’s Indecisiveness
Coinbase’s Chief Legal Officer, Paul Grewal, announced the filing, stressing the urgency of addressing the SEC’s indecisiveness in response to the previous court order. Grewal pointed out that it is highly unusual for the government to disregard a direct inquiry from a federal court.
The SEC had sent a letter to the court on June 13, seeking an extension of 120 days to respond to Coinbase’s rulemaking petition, citing a lack of decision regarding the appropriate course of action. Coinbase asserts that the petition was initially filed in the summer of 2022 and accuses the SEC of deliberately evading questions regarding regulatory frameworks and oversight of the crypto market in the United States. The absence of regulatory clarity in the crypto space has significant implications for the industry and investors, especially considering the SEC’s increasing enforcement actions.
SEC Rejects Petitions
Grewal argued that the court should promptly grant mandamus to Coinbase, as the SEC has made it clear that it will not entertain the exchange’s petitions. Coinbase has petitioned the court to compel the SEC to file a response within 60 days.
Meanwhile, the U.S. House Financial Services Committee has taken steps to address the regulatory concerns surrounding cryptocurrencies. It has released a draft stablecoin bill aimed at providing much-needed clarity to crypto regulation in the United States in the coming weeks. The bill intends to address regulatory ambiguities and determine whether the SEC or the Commodity Futures Trading Commission (CFTC) holds jurisdiction over the crypto industry.
SEC Chair Gary Gensler has consistently advocated for most crypto assets to be classified as securities. However, the unresolved jurisdictional question between the SEC and the CFTC adds further confusion to the regulatory landscape.
