Coinbase says it will challenge SEC crypto rulemaking rejection

The news follows a statement from SEC Chair Gary Gensler agreeing with the decision

December 15, 2023 01:12 pm

Coinbase CEO Brian Armstrong | TechCrunch/"518392245AG023_TechCrunch_D" (CC license)

Coinbase isn’t taking no for an answer.

In a post on X, Coinbase Chief Legal Officer Paul Grewal said that the exchange company will challenge the US Securities and Exchange Commission in a court filing on Friday.

The decision to once again engage the SEC in the courts came after the SEC denied the crypto exchange’s rulemaking petition.

The SEC and Coinbase are locked in multiple legal battles after the exchange sued the regulator in April and then the SEC filed a lawsuit against Coinbase in June.

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The SEC alleges that Coinbase operated as an unregistered exchange while offering and selling unregistered securities, while Coinbase sued to get regulatory clarity. The SEC has said no to Coinbase’s requests multiple times.

The petition was originally filed in July 2022.

“After 18 months of silence, we went to court to get the response the law requires,” Grewal said.

Earlier Friday, SEC Chair Gary Gensler said that he agreed with the Commission’s decision.

“I disagree with the petition’s assertion that now is the right time for the regulatory action it suggests. The Commission and its staff are currently pursuing numerous undertakings applicable to crypto asset securities and intermediaries, and the Commission’s assessment of whether and, if so, how to alter the existing regulatory regime may be informed by the results of these initiatives,” Gensler said in a press release.

Grewal, however, disagreed, saying that “no one looking fairly at our industry thinks the law is clear or that there isn’t more work to do.”

“In Congressional testimony after we were permitted to list in 2021, the SEC Chair himself declared that that there are no regulatory authorities applicable to the cryptocurrency exchanges,” Grewal said, repeating an argument that Coinbase has also used in legal filings.

SEC Commissioners Hester Peirce and Mark Uyeda disagreed with the SEC’s decision Friday and encouraged discussions between the regulator and the public.

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