Newly purchased approximately 6.8 billion yen of stock
Crypto asset (virtual currency) industry venture capital giant Paradigm (Paradigm) has purchased additional shares of major US virtual currency exchange Coinbase on the 9th and 10th. It is a form of investment equivalent to approximately 6.8 billion yen (approximately 50 million dollars).
Paradigm co-founder Fred Ehrsam filed a filing with the US Securities and Exchange Commission (SEC) today about the stock purchase. Ehrsam is also the co-founder of Coinbase and currently serves on Coinbase’s board of directors.
Paradigm purchased 810,000 shares of Coinbase stock at an average price of $61. Paradigm’s two entities, Paradigm One LP and Paradigm Fund LP, currently hold a combined 4.5 million shares of Coinbase shares, according to the filing.
Backs Coinbase in SEC Lawsuit
In addition to the stock purchase, Paradigm has also supported Coinbase’s position in its litigation with the SEC. It is in the form of submitting a court advice on the 10th.
As background, Coinbase filed a limited lawsuit against the SEC in April. It is a request for a response to the “signed document seeking clarification of regulations regarding the cryptocurrency industry” that the company submitted to the SEC in July 2022.
Paradigm agrees with Coinbase, pointing out that “uncertainty exists in the cryptocurrency market due to delays in regulatory development by the SEC.” criticized as follows:
The SEC has not provided clear rules or guidance for cryptocurrencies or cryptocurrency trading platforms. Despite this, it continues to take enforcement action against cryptocurrency companies.
Additionally, the SEC has even refused to respond to a rulemaking petition filed by Coinbase, thereby evading judicial review and prolonging regulatory uncertainty.
It also alleges that while the SEC tells cryptocurrency companies to register their businesses, it does not provide a path to do so.
A U.S. appeals court just ordered the SEC to respond to a petition filed by Coinbase on the 5th. The SEC has been asked to respond within 10 days, but it could also ask the court to extend the time to respond or dismiss Coinbase’s lawsuit.
connection: U.S. Court of Appeals Orders SEC to Respond to Coinbase Petition
What is an Amicus Brief?
system in the United States courts. It allows third parties other than the parties to the trial to formally submit written arguments. Its content will be considered in court.
Industry group CCI also submitted legal advice
In addition to Paradigm, the Crypto Council for Innovation (CCI), a cryptocurrency industry group, also submitted a legal advisory letter in support of Coinbase.
A 🧵 on CCI’s recently filed amicus brief. https://t.co/72KOmbx02s
— Crypto Council for Innovation (@crypto_council) May 11, 2023
The CCI said the SEC’s guidance was limited, “vague, inconsistent, and impractical for the industry,” stating:
By policing through enforcement rather than providing guidelines, the SEC prevents companies from participating meaningfully in agency decision-making. Failure to fairly inform market participants about what is acceptable discourages innovation and investment in cryptocurrencies.
Companies need clear and consistent guidance to operate within a framework that enables compliance.