The chief legal officer of crypto exchange Coinbase says that the U.S. Securities and Exchange Commission (SEC) is determined to stifle the digital asset industry.
In a new thread on the social media platform X, Coinbase executive Paul Grewal says that the regulatory agency is “bent on choking” the digital assets industry by mandating rules that are “unworkable” for crypto firms.
According to Grewal, the SEC is claiming jurisdiction over the crypto industry without Congress authorization or making clear guidelines.
“Today we filed our closing brief in the Third Circuit challenging the SEC’s denial of our rulemaking petition. At the core of this case is a single, conclusory sentence in the SEC order under review.
That sentence – which ‘disagree[d]’ that SEC rules are unworkable for digital asset firms – offered no reasoned decision making; it offered no reason at all.
The SEC’s order must be vacated on this elementary ground alone. The SEC cannot claim broad jurisdiction over a new industry without proper authorization from Congress and without making clear rules.”
Grewal also says that the SEC is firm about suppressing the growth of the crypto industry by ignoring requests for regulatory clarity.
“Remarkably, the SEC says – over and over again – that it doesn’t matter if the industry can comply with the rules. The SEC is bent on choking the digital asset industry and is refusing to provide the necessary rules the industry has requested in order to tighten the squeeze.”
In July 2022, Coinbase filed a petition with the SEC to create a new regulatory framework for digital assets, but the regulator rejected the proposal, saying that it disagreed with the idea that securities laws do not apply to the crypto industry.
Coinbase has sought the assistance of the court to compel the SEC to engage in rulemaking. In the crypto exchange’s latest filing, Coinbase says the SEC continues to double down on holding back the industry.
“The SEC’s response brief is confirmatory: Confirmatory that the government is intent on crushing the digital asset industry. Confirmatory that the SEC will advance the most startling, inconsistent, and insupportable propositions of law to prolong its oppressive campaign.
And confirmatory that anything other than an order to promptly commence rulemaking will abet the dithering and delay that is central to the SEC’s multi-prong attack.”
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