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SEC Reacts to Coinbase In Ongoing Lawsuit

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In a letter, the US SEC responds directly to a former filing that Coinbase made on June 28.

On that day, Coinbase filed for the court to dismiss the SEC vs. Coinbase case due to lack of Jurisdiction.

Coinbase also claimed that the Securities and Exchange Commission did not follow the normal procedure.

The crypto exchange referred to Gary Gensler SEC Chair’s statement when he appeared before Congress.

READ ALSO:Regulators Order Crypto Exchanges To Get license Or Bear Enforcement Actions

On this occasion, Gensler allegedly claimed that the market regulation for cryptocurrency exchanges wasn’t within the scope of the SEC’s authority.

Moreover, he says that it is only Congress that can accord such power.

In addition, Coinbase further highlighted the fact that even though it has been a publicly traded company for 2 years, it is just this period that the SEC is bringing charges against it for the transactions which has been clearly explained to the public and the regulators.

There is no doubt that the resolution of this case will greatly impact the future of the cryptocurrency industry.

SEC’s Response

As per the response made by the Securities and Exchange Commission, the cryptocurrency exchange Coinbase knew fully about its violations of the securities laws.

Moreover, the crypto exchange even went further to warn its shareholders regarding the risks that are involved.

According to SEC’s latest letter, it complained to a district Judge with the argument that says, “How can Coinbase which is known as a multi-billion-dollar company, with a top-notch legal counsel,” deliberately ignore years of standard legal precedent?

Particularly, the Howey test which is a landmark, just so that it can establish its basis for deciding what makes up an investment contract.

More Details of the Story

Previously on June 6 this year, the United States Securities and Exchange Commission filed a legal action against the crypto exchange Coinbase.

According to the charges that were filed against Coinbase, the crypto exchange, since 2019 offered “unregistered securities” to its investors.

In this instance, the unregistered securities are referring to various cryptos.

Going by the Securities and Exchange Commission’s latest response, Coinbase admitted the risks that assets that are traded on its exchange can be categorized as securities.

Furthermore, the regulators referred to the public statements which were made by Coinbase since it became a publicly traded entity.

It went further to emphasize that Coinbase has regularly apprized its shareholders about the possible violation of federal securities laws from its conduct.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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