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In a YouTube interview with Bankless’s host David Hoffman, the Chief Legal Officer of Coinbase, Paul Grewal, responded to questions concerning Coinbase’s lawsuit against SEC.
On June 6, the U.S. Securities and Exchange Commission (SEC) announced charges on Coinbase for operating an unregistered securities exchange broker and clearing agency. This announcement is some weeks after Coinbase received a Wells notice from the commission.
Indeed, the firm’s board and the entire community of crypto enthusiasts have been impatiently waiting for a legal statement, which Grewal admitted to in his introduction.
Grewal stated that his reaction when he received the complaint was expected since he didn’t think any substance of the complaint given was surprising. He said, “Finally, finally, I now at least know what it is that we are accused of.”
The timing of the SEC’s announcement was more interesting as it came on the same day Grewal was scheduled to testify before the House Agriculture Committee on a draft bill.
The draft bill is presumed to provide clarity and regulation to the industry. So enthusiasts now assume that the SEC is on a campaign to regulate by enforcement rather than using reasonable rules.
SEC On A Mission To Regulate The Crypto Industry By Enforcement
The question, “What does the SEC want?” is often asked by communities in the crypto space, with Gary Gensler, Chairperson of SEC, accused of desiring total annihilation.
A Crypto Twitter user in her tweet said,
“Let’s be clear, the SEC complaint doesn’t mention this, but there’s currently no way for a platform like Coinbase to register as a Securities Exchange broker or clearing agent…. there are no allegations of fraud, just accusing Coinbase of failing to do the impossible.”
There is a likely dead end for crypto operating exchange platforms as they won’t be able to register with the SEC in a way that would allow the listing and trading of registered digital assets making it difficult to understand what Gary Gensler wants.
Paul Grewal also mentioned that rulemaking petitions had been constantly filed on the doors of the SEC to work with it to develop a sensible path to registration.
He openly declared that Gary Gensler is an intelligent, sophisticated, and confident chairperson, but it’s quite challenging to understand SEC’s token choices.
Coinbase Considers Delisting Digital Assets As An Approach To Battle SEC
In the video interview, Grewal disclosed that digital assets could be delisted to curb the present issue, but eventually, both parties must agree on solid consumer protection standards.
Compared to the Binance case, there has been no restraining order to freeze Coinbase assets. As such, we will have our full and fair opportunity to defend ourselves in court, and we intend to take it up, Paul said.
Recall that Coinbase kicked off Crypto 435, a movement to teach crypto enthusiasts how to connect with top chains in every district and speak with one voice, in February 2023. According to the exchange, it will empower the community with the information they need to make their voices heard.
Only time will tell the role the movement will play in the recent lawsuits, given that the two largest exchanges in the crypto industry are involved.
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