The regulator argues that it is under no obligation to meet the requirements outlined in Coinbase’s recent petition.
The United States Securities Exchange Commission (SEC) has finally replied to Coinbase’s demand for regulatory clarity. Recall that the American exchange recently filed a petition asking the regulator to make clear crypto regulations. In a formal response issued to the court, the SEC insists that it will take its time to come up with regulations. But while the rules may take some years to make, the regulator confirms that it will carry on its enforcement actions in the meantime.
SEC Insists: ‘We Are Under No Obligation to Meet Coinbase’s Requirements’
It might be worth noting that the regulatory body does not exactly disagree with the fact that there’s a need to draw up clear policies and reforms. According to court documents filed on May 15, SEC says the demands of Coinbase are unrealistic as such complex reforms will take some time. The regulator ultimately argued that it is under no obligation to meet the requirements outlined in Coinbase’s recent petition. The SEC also asked the court to dismiss Coinbase’s petition. In its argument, SEC claims that Coinbase “cannot persuasively claim” that the securities regulator has caused any harm by not acting on the petition since it was initially filed. It also says that Coinbase cannot prove that SEC’s recent enforcement actions mean that it won’t “engage in rulemaking”.
Nonetheless, the agency assures that it will continue to look at Coinbase’s petition in the ordinary course. That is, it would act accordingly when the time is right.
Coinbase also believes that progress is now being made concerning regulatory clarity. According to the exchange’s Chief Legal Officer Paul Grewal, this may be the first time that the securities regulator is commenting on whether or not the SEC should create rules for the crypto industry.
Interestingly, the filing comes only a few hours after SEC Chair Gary Gensler gave a public speech at the Financial Markets Conference. Gensler’s speech hinted that rules for crypto have already been published and should be enough. However, the regulatory body appears to have now distanced itself from Gensler’s public commentary. Grewal said in a Twitter post:
“The SEC also said that the public statements by Chair Gensler are not formal guidance or policy statements from the SEC and the public cannot rely on them as such.”
Overall, it will be interesting to know what the SEC may consider to be within or outside its jurisdiction.
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