Main navigation

SEC Urges Judge to Deny Coinbase's Demand: Details

Tue, 05/16/2023 - 10:18
article image
Arman Shirinyan
Seems like regulatory clarity is last thing SEC wants right now
SEC Urges Judge to Deny Coinbase's Demand: Details
Cover image via

Disclaimer: The opinions expressed by our writers are their own and do not represent the views of U.Today. The financial and market information provided on U.Today is intended for informational purposes only. U.Today is not liable for any financial losses incurred while trading cryptocurrencies. Conduct your own research by contacting financial experts before making any investment decisions. We believe that all content is accurate as of the date of publication, but certain offers mentioned may no longer be available.

Read U.TODAY on
Google News

In an intriguing turn of events, the U.S. Securities and Exchange Commission (SEC) has urged a federal judge to dismiss a motion by Coinbase Global Inc. The cryptocurrency exchange had filed a petition last year, seeking clarity on the application of securities laws to digital currencies.

Coinbase, the leading cryptocurrency exchange in the U.S., lodged the request last month. The company has been vocal in its criticism of the SEC, suggesting the agency's response to its petition has been neither timely nor reasonable. Coinbase is advocating for a formal notice-and-comment process to allow public contributions.

Ethereum Price Reacts to 53,400 ETH Shifted to Coinbase: Details

However, the SEC's counter-argument in a recent court filing rejects Coinbase's claims as unfounded. The filing asserts that Coinbase's desire for swifter or alternative regulatory action does not warrant extraordinary intervention from the court. The SEC's lawyers firmly advise that the petition should be dismissed.

SEC Chair Gary Gensler has consistently maintained that most digital assets fall under securities laws. He asserts that the existing rules are clear and accuses crypto firms of consciously choosing not to comply with them.

XRP Lawsuit: SEC Made Mention of Ripple Escrow Holding, Crypto Lawyer Highlights

The rapport between Coinbase and the SEC has become increasingly strained in recent years. A notable flashpoint occurred in 2021 when the SEC issued a Wells Notice — an intent to sue — over Coinbase's proposed lending product. This resulted in Coinbase abandoning the initiative. However, CEO Brian Armstrong lambasted the SEC's actions as dubious.

These developments have fueled apprehension about the potential impact of the SEC's actions on Coinbase. Mark Palmer of Berenberg Capital Markets estimates that at least 37% of Coinbase's first-quarter net revenue stemmed from non-Bitcoin streams. He suggests that these revenue sources could be the SEC's prime target in an expected enforcement action.

article image
About the author

Arman Shirinyan is a trader, crypto enthusiast and SMM expert with more than four years of experience.

Arman strongly believes that cryptocurrencies and the blockchain will be of constant use in the future. Currently, he focuses on news, articles with deep analysis of crypto projects and technical analysis of cryptocurrency trading pairs.