SEC Lawsuit Against Coinbase
• The US Securities and Exchange Commission (SEC) filed a lawsuit against Coinbase earlier this month. They accused the crypto exchange of running an unregistered securities exchange, broker, and clearing agency.
• Coinbase has now revealed its intent to seek dismissal of the case, arguing that the SEC had approved its initial public offering in 2021 without ever mentioning that it had to register its business.
• It also argued that SEC Chair Gary Gensler had testified around the same time that the agency lacked statutory authority to regulate crypto exchanges.
Coinbase Response
Coinbase responded to the SEC’s complaint by issuing court documents on Wednesday, June 28th which revealed their intent to file for dismissal. The crypto exchange argued that the regulator had approved its initial public offering in 2021 without ever mentioning that it had to register its business. They also pointed out that SEC Chair Gary Gensler had testified around the same time that the agency lacked statutory authority to regulate crypto exchanges. Coinbase denied the listed assets and staking services were securities according to what was stated in the SEC’s complaint.
Questions About Authority and Classification
Coinbase raised questions about both the authority and classification of digital assets as part of their response. They noted that Congress alone could fill any regulatory gaps when it comes to digital asset regulation as per Gensler’s testimony at around the same time as their IPO approval. Further, they denied claims made by SEC regarding classification of listed assets and staking services as securities, calling into question motivation and fairness of lawsuit itself.
Labeling Several Assets Unregistered Securities
The rampage of crypto enforcement lawsuits from United States Securities and Exchange Commission has taken a new turn with regards to case against Coinbase specifically as they have decided to seek dismissal of said lawsuit due accusations leveled against them including running an unregistered securities exchange, broker, and clearing agency; labeling several of their listed assets as unregistered securities; and violation security laws through cross-section services including staking service offered by Coinbase.
Motivation & Fairness Called Into Question
Coinbase called into question motivation & fairness behind this legal battle initiated by SEC by arguing previously approved IPO did not mention registration requirement & lack statutory authority for regulations on digital assets indicated by Gensler’s testimony at same time as approval process was completed; further denying claim made by federal regulator regarding classification of those assets & services under security laws umbrella leading up filing notice for motion for dismissal with court documents submitted on Wednesday June 28th 2021