- SEC claims no obligation to fulfill the crypto exchange’s requirements
- Coinbase: SEC will continue to use enforcement actions as a substitute for rulemaking
The US Securities Exchange Commission (SEC) responded formally to Coinbase’s legal request to pass clear laws on crypto, stating that legislation can take years and they will continue taking enforcement actions in the meantime, court documents filed on May 15 and cited by Cointelegraph show.
The SEC claims it is not obliged to fulfill the crypto exchange’s requirements, arguing the company asked for complex laws and reforms in an unreasonably brief period.
No right to relief
The SEC also asked the court to deny Coinbase’s request for mandamus, a judicial writ issued as a command to an inferior court. They argue that this writ is an “extraordinary remedy” and that Coinbase has no right to relief.
Paul Grewal, Coinbase’s chief legal officer, criticized the securities regulator’s position, saying it left more questions than answers. He tweeted:
Today the SEC responded to Coinbase’s petition for a writ of mandamus — asking the court to require the SEC to respond just yes or no to whether it will undertake rulemaking for our industry. The SEC’s answer? A resounding maybe. The SEC acknowledged that it will continue to use enforcement actions as a substitute for rulemaking for the foreseeable future, but not to worry — those enforcement actions may eventually ‘inform’ not-yet-planned rulemaking.
He added:
The SEC also said that the public statements by Chair Gensler are not formal guidance or policy statements from the SEC and the public cannot rely on them as such. SEC…is likely to continue changing its mind along the way.
Just before the filing, SEC chair Gary Gensler stated existing crypto rules were sufficient in a keynote speech at the Financial Markets Conference.
SEC shouldn’t “be compelled” to pass crypto laws
According to the regulator, it has no legal obligation to pass broad legislation on digital assets as requested by Coinbase. They claim it would be overly complicated and the exchange “cannot persuasively claim” the SEC inflicted any harm by failing to act on its request.
