Regulation
Brief closure of Coinbase files, hits SEC for unclear regulation
Coinbase has made a bold move in its ongoing battle with the SEC by filing its closing brief in the Third Circuit Court. This crucial legal battle is based on a single dismissive ruling in the SEC order that simply “disagreed” with Coinbase’s assertion that current regulations are impractical for crypto companies. But Coinbase isn’t holding back.
Here’s the story.
Understand the core problem
Coinbase argues that this lack of reasoning and detail is enough to dismiss the entire case. The SEC has made a habit of overreaching, claiming broad jurisdiction without clear authorization from Congress and refusing to provide clear rules.
Paul Grewal, chief legal officer of Coinbase, criticized the SEC’s allegations and actions as senseless. In the warehouseCoinbase describes a Catch-22 scenario: the SEC requires compliance based on an overly broad interpretation of its authority, aggressively litigates against crypto firms that don’t comply, and then refuses to establish the rules that would make compliance possible.
The accusations continue to fly
Coinbase argues that the SEC’s actions appear to be a deliberate attempt to dismantle the entire cryptocurrency industry by imposing unattainable demands and punishing companies that fail to meet them.
The brief also accuses the SEC of using inconsistent and unsupported legal arguments to support its campaign against the industry.
The need for regulation entrusted to the Court
Coinbase’s statement said that without a court order mandating regulation, the SEC will continue its arbitrary and oppressive actions. Despite repeated industry requests for clear regulations, the SEC has refused to provide the necessary regulations, making it impossible to comply with federal laws.
Coinbase insists that a court directive is essential to stop the SEC’s arbitrary actions. The company filed its regulatory petition nearly two years ago, but the SEC tried to sideline it through inaction. It took a mandamus petition, court orders, and the threat of an extraordinary writ to compel the SEC to issue even a summary denial order.
Will the SEC finally be forced to play by the rules? The future of cryptocurrencies depends on this crucial legal battle.