As should come as no surprise, Coinbase (NASDAQ:COIN) is planning to quickly respond to the Securities and Exchange Commission’s (SEC) denial of their petition for rulemaking in regard to specific digital asset rules.
Earlier today, CI reported that SEC Chairman Gary Gensler issued a statement regarding the petition that Coinbase filed in 2022 to demand the SEC “propose and adopt rules to govern the regulation of securities that are offered and traded via digitally native methods.”
The SEC, under the leadership of Gensler, has studiously ignored the petition until today, when the Chair stated:
“… to the extent that crypto assets are offered and sold in the form of an investment contract, and to the extent that entities intermediate transactions in crypto asset securities, the federal securities laws apply.”
Obviously this was not the response that Coinbase hoped for.
Several hours ago, Paul Grewal, Coinbase’s Chief Legal Officer, distributed the letter sent to Coinbase authored by the SEC.
The letter stated that the SEC disagrees with Coinbase’s assertion that existing securities laws and regulations are unworkable for crypto assets.
Any consideration of whether and, if so, how to alter the existing regulatory regime may be informed by, among other things. and information provided by numerous undertakings directly or indirectly relating to crypto asset securities that the Commission is currently pursuing. Accordingly, the Commission concludes it is appropriate to deny the Petition. The Commission is also engaged in many undertakings that relate to regulatory priorities extending well beyond crypto asset securities. The requested regulatory action would significantly constrain the Commission’s choices regarding competing priorities, and the Commission declines to undertake it at this time.
Kind of a no-plus additional shade.
Grewal said that after 18 months of silence, they will address the Third Circuit court to seek its help in “challenging the SEC’s abdication of its duty.”
Grewal did thank the two Commissioners who issued a dissenting statement.