Coinbase Blasts SEC For Protracted Silence Following Court Order

Updated: 19 June 2023

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Amidst the recent regulatory battle between SEC and Coinbase, Coinbase has not forgotten that it has asked SEC to clarify its stance on crypto. On Saturday, the crypto exchange company filed an official request in federal court slamming the United States regulator for failing to answer questions asked in the U.S. Court of Appeal as part of its ongoing legal battle.

In the letter filed by the crypto firm, the legal team of Coinbase addressed the Securities and Exchange Commission (SEC) for continuing to duck Coinbase’s rulemaking petition. Further, the petition calls on the SEC to establish a regulatory structure for digital assets.

The letter stated:

When ordered by this Court to address the stark inconsistency between its litigating position and its actions and statements elsewhere, the SEC still offers no straight answers and instead repeats its talking points

The letter is in response to the SEC’s June 13 submission, requesting 120 days return to Coinbase’s rulemaking petition.

As per Coinbase’s filing, the platform requests a “mandamus,” a court order issued by a higher court to a government agency, commanding them to perform a duty they are legally obligated to conduct.

In simpler terms, Coinbase is asking a federal judge to force the SEC set more explicit rules and standards for the digital assets industry (the objective of a petition made by the platform last year).

Coinbase Versus SEC

Earlier this month, the SEC sued the crypto exchange, alleging that it failed to register as an exchange, clearing house, and broker, despite facilitating investors with these services. The lawsuit notably claims that the prominent exchange sold unregistered securities on its platform.

However, on June 17, Coinbase’s Chief Legal Officer, Paul Grewal, noted in a series of tweets that:

We couldn’t wait until next week’s deadline to address the SEC’s response to the June 6 order from the Third Circuit. It is unusual for the government to defy a direct question from a federal court.

We couldn’t wait until our deadline next week to address the SEC’s response to the June 6 order from the Third Circuit. It is unusual for the government to defy a direct question from a federal court. But the SEC’s evasive response goes further, as we set out today. 1/5 pic.twitter.com/ssULmUpzi2

— paulgrewal.eth (@iampaulgrewal) June 17, 2023

Grewal has further noted that:

The Commission’s refusal to say how much additional time it needs to act on Coinbase’s petition confirms that further delay is futile. At a minimum, the Court should order the Commission to report on Its action.

Coinbase has been steadfast and relentless in its quest for a definitive regulatory scheme. The crypto exchange is also submitting the Court to set a deadline of 60 days or less starting from June 13 — the date of the SEC’s request.