The U.S. Securities and Exchange Commission (SEC) dismissed Coinbase’s plea for tailored regulations on cryptocurrencies, deeming them “unwarranted,” as reported by TronWeekly. The denial has prompted Coinbase to escalate the matter to the courts, seeking legal recourse in its quest for regulatory clarity in the crypto industry.
Coinbase’s Co-founder and CEO, Brian Armstrong, revealed the newest development in the ongoing narrative. In a recent X post, he expressed satisfaction with the outcome of their court challenge against the SEC’s reluctance to establish clear rules for the crypto sector. Armstrong revealed that the court compelled the SEC to respond formally, which, despite resounding “no,” opens the door for further legal action.
The SEC’s decision comes after a prolonged wait since 2022, during which the exchange sought a response to its formal petition for specific regulations governing cryptocurrencies. In a press release, the SEC asserted no need for a new regulatory framework, highlighting its ongoing efforts to craft targeted crypto rules and enforce existing authorities. However, it is worth noting that two out of the five SEC commissioners dissented from this standpoint.
Coinbase Challenging SEC’s Denial In Court
Paul Grewal, Chief Legal Officer at Coinbase, affirmed their commitment to challenging the SEC’s denial. He tweeted, “Promise made, promise kept,” announcing their filing with the Third Circuit to contest what they perceive as the SEC’s arbitrary and capricious dismissal of their petition for crypto rulemaking.
In an official filing with the Third Circuit Coinbase, the SEC’s long-awaited response was outlined, characterizing it as the culmination of their mandamus petition. The petition had compelled the SEC to issue a judicially reviewable decision on Coinbase’s request for crypto rulemaking, which the SEC had allowed to linger for over a year.
Coinbase’s move to seek judicial review signifies a turning point in their battle for regulatory clarity as they challenge the SEC’s refusal to act on their rulemaking petition. The rejection may pave the way for a thorough examination of the SEC’s stance on crypto regulations, providing the crypto industry with an opportunity to address outstanding regulatory uncertainties.