In a request filed late Monday, crypto exchange Coinbase petitioned the federal court to compel the Securities and Exchange Commission to respond to its demands for more precise crypto regulations. Also, on the same day, Cathie Wood’s Ark Invest purchases $8.6 million worth of Coinbase’s shares.
Coinbase cited the Administrative Procedure Act in the petition, noting that the law required the SEC to respond to its request within a “reasonable” amount of time, which the regulator has defaulted on.
Coinbase submitted a petition for rulemaking to the US regulator in July 2022, requesting that the SEC set out defined rules for crypto regulation in the country. The exchange also asked the SEC 50 questions that, if answered, would address the unclarity surrounding the regulatory chaos in the US.
SEC Purposely Denying Petition: Coinbase
Coinbase stated in a blog post that, based on the SEC’s recent public statements and activities, it has made up its mind not to reply to its petition; hence, it has to take legal action. The exchange clarified that the move was not for the court to tell the regulator how to reply to its petition but for it to compel the SEC to respond to the request as the law requires.
The SEC sued Coinbase the same day the exchange filed the petition for offering unregistered securities. The regulator claimed that nine of the tokens Coinbase listed were securities, and the crypto firm did not register them. This prompted the US-based crypto firm to file the petition, requesting that it make clear its parameters for calling an asset a security.
Coinbase Believes Regulation is Overdue
Regulators in the US have stepped up their crypto crackdown this year and have walloped exchanges they find to default. This action has prompted concerns in the US crypto industry, as they argue that the regulators have not defined specific crypto laws they have imposed on them.
The SEC shut down Kraken’s staking services earlier in the year, stating it was a security issue. A court in New York filed a lawsuit against KuCoin and said that Ethereum was a security. The recent regulatory tightening by US regulators also affected several other exchanges based in the country.
Coinbase has argued that unclear crypto regulations should not be imposed on exchanges. The exchange has stated that it will continue to push regulators across the country to set out clear stipulations that will guide the crypto industry as it is overdue.
“The action Coinbase filed today is a small but important part of our multi-year, continual plea to leaders in Washington for clear rules of the road. We recognize that rules are needed, and we have asked for rules to be developed,” Coinbase stated.
