Coinbase files limited lawsuit against SEC
U.S. cryptocurrency exchange Coinbase announced on the 24th that it had filed a limited lawsuit against the SEC (U.S. Securities and Exchange Commission) in federal court.
The lawsuit is narrow, focusing on a specific issue rather than the legal issue as a whole. The purpose is to seek a response to the “petition (signed document) for clarification of regulations regarding the virtual currency industry” submitted by Coinbase to the SEC in July 2022.
Technically, the SEC has already decided to deny the petition, but has yet to officially announce its decision, so Coinbase will share its decision with the SEC through a federal court filing. I am asking for
If the SEC grants a denial of the petition, Coinbase can challenge that decision in court. Under the Administrative Procedure Act (APA), Coinbase can challenge the SEC’s decision on a formal basis, arguing that rulemaking is necessary.
The lawsuit is a countermeasure against the SEC’s enforcement action before it has released its legal opinion. Through this process, Coinbase will have the opportunity to seek regulatory clarity in the cryptocurrency industry.
Coinbase argues that clear regulation is needed for the US to lead the technological transformation enabled by blockchain technology.
What is the Administrative Procedure Act (APA)?
A law enacted in 1946 that stipulates the rule-making and review process for federal executive agencies. The aim is to ensure fairness and improve transparency in administrative management, and to protect the rights and interests of the people.
In July 2022, Coinbase filed a petition with the SEC asking it to “develop a workable regulatory framework.” The petition argues that cryptocurrencies classified as securities “need new rulebooks to guide safe and efficient practices.” “Cryptocurrencies that are not securities need certainty that they are outside the scope of such rules,” it said.
To date, more than 1,700 groups and individuals have submitted comments and expressed their support for the petition.
connection:Coinbase Filed Petition to SEC to Create Crypto Regulations
However, the SEC has not issued a concrete public response to the 2022 petition, but has continued to carry out enforcement actions against individuals and organizations in the cryptocurrency industry. Coinbase also issued a “Wells Notice” in March.
The SEC’s investigation includes listed cryptocurrencies and the staking service Coinbase Earn. Coinbase said it believes in the legality of its stocks and services and welcomes lawsuits.
connection:SEC Investigates Coinbase for Securities Law Violations, Sends Wells Notice