US SEC Fails to Respond to the Coinbase Rule-Making Petition After the Lawsuit

The U.S. Securities and Exchange Commission (SEC) issued a report dated June 14 revealing its stance on the Coinbase petition. In the report, the SEC was uncertain whether there was a need to clarify the crypto regulation as earlier requested by Coinbase.

The SEC official had confirmed to respond to the Coinbase petition within four months. Responding to a court order, officials from the SEC stated that within the next 120 days, the commission would provide valuable inputs concerning the Coinbase petition.

Will SEC Comment to Coinbase Petition?

On the contrary, the Coinbase team urged the court to take enforcement action against the commission to force the SEC to comment on its petition.

In a court filing dated June 13, the SEC confirmed that it was yet to decide on the action to take concerning the rule-making process proposed by Coinbase. The SEC report was presented before Judge Cheryl Ann Krause of the U.S. Court of Appeals.

The SEC urged the regulated crypto firms in the U.S. to observe the existing regulations. The commission confirmed that its operation and enforcement action upholds compliance with the current regulations in the U.S.

According to the Coinbase petition, the crypto exchange demanded the SEC provide clear regulations for crypto assets. In their submission, the Coinbase team requested the SEC to clarify which digital assets are classified as securities and the regulations of such cryptos.

Why is SEC Refusing to Respond to Coinbase Petition?

On June 5, the SEC issued a fresh lawsuit against Coinbase for offering crypto services without obtaining the necessary license. The SEC criticized Coinbase for failing to safeguard the investor’s interests.

In a Twitter statement, the chief legal officer at Coinbase, Paul Grewal, regretted that the SEC had failed to issue feedback on the proposed crypto regulations. Grewal noted that the SEC has occasionally failed to observe the deadline set by the court, which was against the law.

The SEC’s potential action on Coinbase aligns with the commission’s ongoing clampdowns on the crypto sector. Led by the SEC chair Gary Gensler the commission considered around nineteen crypto assets as securities.

A few days ago, the SEC charged Binance US  and the chief executive officer Changpeng Zhao for violating the securities regulations. As of this publication, Binance is charged with 13 cases concerning violating crypto regulations.

Prior to this, leading crypto exchanges in America, such as Kraken and Gemini, were charged by the SEC for offering unregistered securities to the public.

In an interview with the SEC chair, Gensler stated that cryptocurrency was not welcomed in the U.S. He confessed that there was no need to release more digital assets due to numerous cases of noncompliance in the crypto sector.

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