Peirce, Uyeda ‘disagree’ with SEC decision to deny Coinbase petition

The decision, praised by chair Gary Gensler, was announced Friday


US Securities and Exchange Commissioners Hester Peirce and Mark Uyeda responded to the US regulator’s decision to deny a rulemaking petition from Coinbase on Friday.

The two said that they disagreed with the decision, a contrast to the statement released by agency chair Gary Gensler that praised the decision. 

“The Petition raises issues presented by new technologies and other innovations, and addressing these important issues is a core part of being a responsible regulator. Any exploration of these issues should include public roundtables, concept releases and requests for comment, which would afford us the opportunity to hear from a wide range of market participants and other interested parties,” Peirce and Uyeda wrote.

The Commission could use the discussions to further its rulemaking or just use them as guidance, the two added.

The SEC denied Coinbase’s 2022 rulemaking petition early Friday, claiming that the current framework of securities laws is suitable for crypto regulation.

Gensler, in his press release, even quoted the SEC’s director of enforcement saying that “you can’t simply ignore the rules because you don’t like them.”

Coinbase, in its original petition filed back in July 2022, argued that the “securities rules simply do not work for digitally native instruments…They don’t work for crypto.”

“Crypto assets that are securities need an updated rulebook to help guide safe and efficient practices. Crypto assets that are not securities need the certainty of being outside those rules,” Coinbase said at the time.

The SEC and Coinbase have gone head to head in a couple of legal battles. In April, Coinbase sued the SEC after it received a Wells Notice. It demanded regulatory clarity from the regulator.

In June, the SEC filed a lawsuit against Coinbase alleging that the company operated as an unregistered exchange while offering and selling unregistered crypto assets. It also targeted its crypto staking service.

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