SEC rejects Coinbase’s request for a separate regulatory framework for the cryptocurrency industry

William of England
By William of England 3 Min Read

“The commission concludes that the requested rulemaking is currently unwarranted and denies the petition,” the SEC wrote in a letter addressed to Coinbase’s chief authorized officer, Paul Grewal.

Gary Gensler, the chair of the SEC, cheered on the denial in a separate statement, saying that he supported the fee’s resolution as a result of, he argues, present legal guidelines and laws already apply to crypto, the SEC already addresses the industry via rulemaking, and it’s necessary for his company to keep up management over what assets it deploys to supervise its regulatory agenda. “As I said prior to the collapse of one of the largest noncompliant crypto intermediaries that cost investors billions of dollars,” he wrote, “meaningful engagement with the SEC is always welcome.”

Spokespeople for Coinbase didn’t instantly reply to a request for remark when contacted by Fortune.

The SEC’s ruling on Coinbase’s petition comes greater than a yr after the firm filed its request with the company, arguing that the “U.S. does not currently have a functioning market in digital asset securities due to the lack of a clear and workable regulatory regime.”

After the collapse of FTX in November 2022 and the subsequent arrest of the alternate’s CEO, Sam Bankman-Fried, the SEC, below the steering of Gensler, has launched into an intensive marketing campaign towards crypto.

In the first half of 2023, it focused a few of the largest gamers in the industry, submitting fits towards Gemini, Genesis, Terraform Labs and founder Do Kwon, in addition to Justin Sun and Tron. In June, it launched salvos towards two crypto heavyweights, first suing the world’s largest crypto alternate, Binance, after which submitting a lawsuit towards Coinbase. The SEC’s marketing campaign has continued via the finish of the yr, with it most just lately concentrating on one other industry mainstay, the crypto alternate Kraken.

Most of its lawsuits towards the industry’s high gamers are ongoing, even its litigation towards Binance, which just lately agreed to a $4.3 billion settlement with the Department of Justice for breaking anti-money laundering legal guidelines, amongst different crimes.

Coinbase, which positions itself as one in every of the industry’s do-gooders, has cried foul at the SEC’s in depth litigation towards crypto, claiming the company is “regulating through enforcement,” reasonably than rulemaking. Evidently, the SEC disagrees, and its lawsuit towards Coinbase, which it alleges listed unregistered “crypto asset securities,” continues to wind its method via courtroom.

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