Coinbase Global Inc. (NASDAQ: COIN) has filed a motion with the United States District Court of the Southern District of New York seeking to have the lawsuit charges presented by the Securities and Exchange Commission (SEC) dismissed for lack of merits. According to the exchange, the SEC knew all operations – including staking and listing – that Coinbase undertook when it approved its request to go public back in May 2021.
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Coinbase Argues Against SEC Case
According to Coinbase Chief Legal Officer Paul Grewal, the exchange is ready to sit down with any regulatory agency including the SEC on the best pasty forward for crypto rulemaking. Moreover, Coinbase argues that the crypto market is a global nascent industry that needs Congress to pass new laws for regulating the industry. Failure to which the country risks losing its tech touch to other markets like Europe, China, and Singapore that have already enacted clear crypto regulations.
In the 177-page document, Coinbase noted that the SEC grounded its charges in allegations that 12 out of the listed crypto tokens traded on the exchange are securities. Interestingly, six of the twelve mentioned crypto assets were already trading on Coinbase when the SEC agreed to the exchange to go public. Since the SEC called none of the crypto assets a security then, Coinbase argues that the legal charges should be dropped immediately.
Additionally, Coinbase argues that the SEC lacks the powers to regulate the nascent crypto market since Congress has not enacted proper laws in place.
“In May 2021, weeks after Coinbase went public, SEC Chair Gary Gensler testified before Congress that the Commission lacked statutory authority to regulate businesses like Coinbase. He said that only Congress could address the regulatory gap that Commission officials had long recognized,” Coinbase noted.
