The cryptocurrency world watches as Coinbase, the largest cryptocurrency exchange, continues its regulatory battle with the U.S. Securities and Exchange Commission (SEC). On Monday, May 15, the SEC sought to dismiss Coinbase’s plea for crypto regulatory clarity, adding another chapter to the ongoing conflict.
Coinbase is Suing the SEC
Coinbase sued the SEC in April, questioning whether securities regulations should apply to the world of digital currencies. The lawsuit stemmed from the agency’s failure to respond to a July 2022 petition from Coinbase, seeking guidance on regulatory frameworks for the crypto industry.
Paul Grewal, Coinbase’s Chief Legal Officer, publicly criticized the SEC’s lack of response. Further, he highlighted the industry’s need for clarity as companies navigate potential punitive actions from the agency, underscoring the uncertainty of how the SEC interprets laws concerning cryptocurrency businesses.
The SEC finally responded this Monday, dismissing Coinbase’s request. “Coinbase’s preference for faster or different regulatory action by the commission does not entitle it to extraordinary relief from this court”, wrote the agency in a statement.
How Did Coinbase React?
Grewal’s response to the SEC‘s decision, published on Twitter, was one of disappointment. He cited the SEC’s apparent lack of urgency in establishing rules for the crypto industry. Moreover, he pointed out that this was the SEC’s first clear communication on their stance towards crypto regulation.
The SEC’s response, Grewal stated, adds to Coinbase’s existing concerns about the lack of regulatory clarity in the crypto industry. Moreover, he expressed concern about “the changing nature of the SEC’s jurisdiction” and hinted at the potential for continued shifts in the future.
Coinbase is set to officially respond to the SEC in the coming week. This is the latest development in the ongoing saga between Coinbase and the U.S. Securities and Exchange Commission, which escalated when the agency issued a “Wells notice” to Coinbase last March. It indicated their intent to take legal action.
As this case unfolds, it underscores the pressing need for clear regulatory guidelines in the ever-evolving cryptocurrency industry.