Coinbase CLO Accuses SEC Of Continued Stonewalling, As Legal Battle Intensifies

In a dramatic uptick of their ongoing legal dispute, the Chief Legal Officer (CLO) of Coinbase has publicly accused the USA Securities and Exchange Commission (SEC) of persistent stonewalling and impeding their efforts. Grewal made these comments because the San Fransisco-based cryptocurrency exchange pushes back against what it sees because the SEC’s unclear regulations and overreach within the rapidly growing crypto space.

Coinbase Demands Key Documents From The SEC Chairman

In a series of posts on the X (formerly Twitter) platform, Coinbase CLO Paul Grewal alleged that the SEC has constantly adopted an aggressive enforcement strategy without providing a practical framework for compliance, in favor of refusing to supply clear regulatory guidelines.

The Coinbase CLO has revealed further details regarding the corporate’s ongoing legal battle with the SEC. A big obstacle still exists, although some concerns just like the Chevron deference and secondary sales of Binance‘s BNB token have been made clear.

Grewal claimed that the SEC was acting in a way that might impede the disclosure of key information that might help Coinbase establish its case against the Commission. “And now, late on a Friday, more stonewalling from SECGov to stop Coinbase from obtaining documents from Gary Gensler in our litigation,” he stated.

Drawing attention to May 2021, Grewal highlighted that after Gary Gensler was sworn in because the chairman of the SEC, Gensler confirmed market participants’ long-held belief that transactions involving digital assets traded on exchanges were exempt from securities rules when he testified before Congress, stating that the agency lacked regulatory power over such exchanges.

He further underlined several other different statements on this subject from the regulatory watchdog’s chairman to audiences of market participants in addition to most people.

To date, resulting from the relevance of those interactions in demonstrating how the SEC’s enforcement motion violates the due process clause of the Structure, Coinbase has requested that Gensler provide records pertaining to those communications. Nevertheless, Grewal noted that the agency and its chairman try to maintain these interactions hidden from them and most people.

Broader Frustration In Cryptocurrency Landscape

Paul Grawal‘s allegations make clear the crypto community’s general dissatisfaction with what many see as hostile and unpredictable regulation. This comes after several months of court disputes between the SEC and Coinbase. 

These days, Coinbase has consistently demonstrated its efforts to have interaction with the SEC to hunt clarity and address regulatory concerns. On Thursday last week, the crypto exchange sued the SEC demanding crucial documents from the agency that would help with its ongoing litigation. Nevertheless, the Commission has yet to reply to the motion.

The essential point of contention within the dispute is the SEC’s claims that the crypto exchange has been acting as an illegal securities exchange and providing investors with unlicensed securities. Within the larger conflict over the correct regulation of cryptocurrencies and digital assets within the US, this legal discourse might be a significant turning point, because the result might establish significant precedents for crypto regulations.

COIN trading at $222 on the 1D chart | Source: COIN on Tradingview.com

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