In a previous court filing, the US Chamber of Commerce issued a report demanding the Securities and Exchange Commission (SEC) to redefine its regulatory approach to cryptocurrency. The Chamber of Commerce expressed concern about the SEC’s lack of regulatory clarity that explains which crypto assets are grouped as securities under federal law.
A few days ago, the American-based crypto exchange Coinbase demanded the court to force the SEC to respond to their July petition. In the submission “petition for rulemaking”, the Coinbase team requested the SEC to adopt friendly regulations for cryptos and demanded responses to multiple questions on the supervision of digital assets.
Will SEC Respond to Coinbase Petition?
In support of the Coinbase filing, the Chamber of Commerce accused the SEC of formulating uncertain crypto regulations. The Chamber of Commerce presented its argument through the amicus report that provides the court with additional information and advice concerning a subject matter submitted by the third-party Coinbase.
According to the Chamber of Commerce, the enforcement approach adopted by the SEC swept the authority over crypto assets. The legislators slammed the SEC for creating regulatory chaos.
After reviewing the Coinbase petition, the legislators observed that the crypto exchange demanded regulatory clarity. They noted that the clear and sufficient crypto regulations sought by Coinbase didn’t require adopting new laws.
The petition mentioned that the SEC only offered regulatory clarity by adopting the common rules. The Coinbase proposal aimed at documenting crypto regulation proposal with fixed deadlines.
Per the petition, the documentation of policies mandated the crypto firms to uphold compliance with the regulations. Imperatively, the crypto exchange only required responses for unclear laws. In July, the Coinbase team observed the current legal procedure and time frame to formulate and submit the proposal in court.
Effect of Lack of Regulatory Clarity
Commenting on the Coinbase petition, the legislators from the Chamber of Commerce argued that the SEC delays in offering responses destabilized crypto regulations. As such, SEC’s pending responses undermined the expansion of Coinbase and the economy at large.
Also, it was reported that SEC regulatory approach limited innovation in the crypto space. The Chamber of Commerce highlighted that the SEC move triggered the devaluation of the US dollar, which impacted the shift to digital assets.
The SEC’s conduct affected the realization of geopolitical interests in the US. In their address, the legislators criticized the Well notice issued by the SEC to the crypto exchange. The notice stated that Coinbase offered unregistered staking products grouped as securities.
Additionally, the SEC was against Coinbase Wallets for violating the law. They argued that the SEC regulatory technique violated Coinbase’s right to an official and fair notice. Reflecting on the Well Notice, the legislators observed that it lacked sufficient information to describe Coinbase’s misconduct for further enforcement action.
Scope of Chamber of Commerce Proposal
Beyond this, the policymakers labelled the SEC’s legal action as unlawful and harmful. They stated that the SEC failed to outline the rules of the road, which comprise the legal actions and privileges for crypto regulations.
The Chamber of Commerce debated the enforcement approach utilized by the SEC, which was harmful. In their opinion, the legislators condemned the SEC regulatory action, which compelled the public to provide valuable input on regulating cryptos.
In an earlier report, SEC chair Gary Gensler stated the existing securities regulations applicable to crypto rules were unambiguous.
Nevertheless, the legislators stated that SEC’s enforcement action deprives the public of participating in the amendment of the existing Depression-era regulations. This regulation has adversely affected investors and businesses involved in the $1 trillion economy.
The SEC’s potential actions limit the public from providing valuable input on regulation. Besides the speculations raised by the Chamber of Commerce, more than 1700 individuals commented on the Coinbase July petition.
In the meantime, the Chamber of Commerce acts as a representative to over 3 million businesses and investors in the US. In contrast, Coinbase ranks among the largest crypto exchanges across the globe.