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Amidst the recent regulatory battle between SEC and Coinbase, Coinbase hasn’t forgotten that it has asked SEC to clarify its stance on crypto via the application. The Securities and Exchange Commission has now said that it would need more time to clarify crypto via a letter submitted on June 13.
However, the Commission has also stated that this query has no merit anymore.
We Need More Time to Clarify Crypto – Securities and Exchange Commission
In a letter submitted to the US Court on June 13, the Securities and Exchange Commission said that it would require another 120 days to reply to Coinbase’s request.
The request is to adopt new crypto rules and provide clarity about the rules that govern cryptocurrencies.
In July 2022, Coinbase filed a petition to SEC requesting: “The commission propose and adopt rules to govern the regulation of securities that are offered and traded via digitally native methods”.
The petition also contained a request for the potential rules that could help with the identification of digital assets that are securities. There were 50 questions highlighted in that request. However, the Securities and Exchange Commission has not provided any reply to that request yet.
That culminated in the US court ordering SEC on June 6 that it should address if it denies making any rules or if it needs more time to respond.
To that, SEC replied that it is yet to decide what course of action to take, adding that Coinbase’s request for the writ of mandamus has “no merit”.
Petition Should be Denied According to SEC
The SEC isn’t stopping at merely saying that it needs more time. It has continued to disparage Coinbase’s efforts to get an answer.
The regulator has stated that the court should deny the mandamus position. However, out of formality, it has said that it would be able to make recommendations on the petition within the next 120 days.
Shortly after, Paul Grewal, the Chief Legal Officer at Coinbase, tweeted that SEC is “ignoring clear instructions of the chair and has no intention to issue new rules”.
He continued stating that SEC wants to mix the evidence and say that the statements it is giving are its main decisions.
The lack of any statement by the SEC is questionable. However, we should also note that in the face of a recent lawsuit, the Commission is probably biding its time to build a case against Coinbase.
SEC is Wrong Agency to Govern Digital Assets – Hinman Documents
The founder of CryptoLaw, John Deaton, got a glimpse at the long-awaited Hinman documents that were finally revealed to the public.
The documents highlight valuable insights that Bill Hinman, former director of the SEC’s corporation finance division, delivered in his speech in 2018.
The speech showed his perspective on Ethereum and other cryptocurrencies. He stated that regulators must not consider them securities.
John Deaton weighed in and said that the document says that tokens like Ripple and exchanges like Coinbase are wrongfully targeted by regulators.
According to Deaton, these documents may influence public opinion. That would play a vital role in shaping the regulations around cryptocurrencies.
Can Coinbase Survive SEC’s Onslaught Against Crypto Industry?
Coinbase and other crypto players are at the receiving end of the ire of regulators. These regulators have long been the fiercest critics of crypto, and their regulations have largely been regressive.
But does that mean Coinbase won’t survive SEC’s lawsuit? It depends on multiple factors. While regulators are rallying against crypto, there are many entities within the governments that are trying to defend the crypto community.
So, we are in for a long battle this year for the future of cryptocurrencies.
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