According to Bloomberg, Paul Grewal, Coinbase’s Chief Legal Officer, stated in an interview that Coinbase is ready to challenge the US Securities and Exchange Commission (SEC) in the US Supreme Court
Grewal expressed their preparedness to take the matter to the highest court, emphasizing his belief that every court examining the issue will ultimately find that the SEC has fundamentally misunderstood the situation.
Coinbase was sued by the SEC on Tuesday for alleged violations of securities laws. Prior to this, Coinbase had filed a mandamus action with the Third Circuit, urging the SEC to respond to their petition for formal rulemaking in the digital assets industry, which was submitted last year.
Paul Grewal took to Twitter, stating that the court acknowledged the SEC’s lawsuit against Coinbase and inquired whether it implied that the SEC had made a decision to reject the petition.
In his statement, Grewal emphasized the importance of establishing clear rules through legislation or rulemaking before initiating enforcement actions. He highlighted Coinbase’s petition to the SEC for rulemaking almost a year ago, as it reflected their belief in the necessity of such guidelines.
Grewal pointed out that if the SEC’s response to their petition is negative, they are legally obligated to inform Coinbase, who retains the right to challenge that decision in court. He further emphasized the existence of significant questions that need to be addressed in this context.
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Coinbase CEO Brian Armstrong highlighted on Twitter regarding the SEC complaint
In 2021, Coinbase underwent a review by the SEC and was granted permission to go public. However, despite repeated attempts, Coinbase has been unable to find a clear registration path.
It’s important to note that Coinbase does not list securities and is selective in the assets it approves.
Complicating matters further, the SEC and CFTC have conflicting views on the classification of assets as securities or commodities.
Addressing these concerns, new legislation is being introduced in the US Congress to address the situation, while other countries are also working towards establishing explicit regulations to support the cryptocurrency industry.
Expressing their dissatisfaction with the SEC’s approach, Grewal stated that the SEC’s reliance on enforcement actions rather than providing a clear set of rules is detrimental to the United States.
They asserted that if resorting to the courts is necessary to attain clarity, they are prepared to do so. Grewal made it clear that the lawsuit against Coinbase stands apart from others, as it specifically revolves around the determination of securities.
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They expressed confidence in their understanding of the facts and the applicable legal framework.
Important: This article is intended solely for informational purposes. It should not be considered or relied upon as legal, tax, investment, financial, or any other form of advice.
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