Javier Hernandez The U.S. Securities and Exchange Commission (SEC) has dismissed a request by the cryptocurrency exchange Coinbase for definitive regulatory guidelines in the cryptocurrency sector. The SEC’s Chairman, Gary Gensler, has supported his agency’s decision to refuse Coinbase’s request. As a result, Coinbase has taken legal steps against the SEC to contest this ruling.
Legal Battle Initiated by Coinbase Against SEC’s Ruling
Coinbase Global’s Petition for Rulemaking has been rejected by the U.S. Securities and Exchange Commission (SEC). Last July, the cryptocurrency exchange submitted this petition, seeking clear regulatory directives, specifically guidelines to classify which digital assets are considered securities. After waiting 18 months without a response from the SEC, Coinbase escalated the issue to the legal arena, leading to a formal refusal from the agency last Friday.
Gary Gensler, the Chair of the SEC, provided a statement about the refusal:
I am in favor of the Commission’s choice for three key reasons.
“Firstly, current laws and regulations are applicable to crypto securities markets. Secondly, the SEC also employs rulemaking for addressing the crypto securities markets. Lastly, it’s crucial to preserve the Commission’s discretion in determining its rulemaking priorities,” Gensler explained in detail.
Paul Grewal, Coinbase’s Chief Legal Officer, remarked on the matter: “Today, the SEC rejected our request for rules governing crypto. After a year and a half of no response, we turned to the courts to solicit the legally required reply. We are grateful to the Third Circuit and will soon seek its assistance once more by challenging the SEC’s neglect of its responsibilities.”
In a subsequent statement, Grewal disclosed:
As promised, we have filed with the Third Circuit to contest the SEC’s unjustified and arbitrary dismissal of our petition for rulemaking in crypto. We are again thankful for the court’s attention to this matter.
Brian Armstrong, the CEO of Coinbase, stated: “We resorted to legal action to confront the SEC’s reluctance to establish clear guidelines for the industry — and it prompted a response (the court forced them to reply).” He further noted: “Now that they have formally responded (with a refusal), we can take their response to court, pushing us nearer to achieving regulatory clarity. The pressing question remains, why is the SEC hesitant to provide clear regulatory guidance for the crypto industry?”
What are your thoughts on the SEC’s refusal of Coinbase’s request for clear regulatory guidelines in the cryptocurrency sector? Share your views in the comments section below.
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