SEC urges judge to dismiss petition on crypto regulation

The SEC has urged the judge to dismiss Coinbase’s petition for an explanation on the rules applied by the stock market regulator in the crypto industry. Immediately, Paul Grewal, Coinbase’s Chief Legal Officer, expressed concerns about this response. According to him, the SEC will continue to oversee the crypto sector by enforcing regulations forcefully.

The SEC is seeking the denial of Coinbase's petition, arguing that the firm has asked for too much, too soon, while the agency has no obligation to meet its demands. https://t.co/jdf9bedquS

— Cointelegraph (@Cointelegraph) May 16, 2023

SEC’s response to Coinbase regarding an explanation on the rules applied to cryptocurrencies

For several months, Coinbase and other actors in the crypto sphere have complained about the arbitrary regulations imposed by the SEC. The crypto exchange had filed a petition demanding explanations on the rules applied by the stock market regulator. The United States Securities Exchange Commission has now provided an official response to the court regarding this request. It states that the development of rules can take years and that enforcement measures will continue in the meantime.

According to documents filed on May 15, the SEC argued that it was not obligated to respond to Coinbase’s demands. The regulatory authority also asks the court to reject Coinbase’s mandamus request.

According to an excerpt from this response reported by Cointelegraph, the SEC states: “Neither the securities laws nor the Administrative Procedure Act impose on the Securities and Exchange Commission an obligation to issue the broad new regulations regarding ‘digital assets’ Coinbase has requested.”

Until when will enforcement regulation continue?

Coinbase‘s Chief Legal Officer stated on Twitter that there are still many things on the table. “The SEC told the court that rulemaking may take years and they’re in no rush,” he said. He then added: “The SEC acknowledged that it will continue to use enforcement actions as a substitute for rulemaking for the foreseeable future, but not to worry — those enforcement actions may eventually “inform” not-yet-planned rulemaking.”

The United States remains one of the few major countries where cryptocurrency regulation is still very uncertain. Companies are calling for regulation, but the SEC remains silent on the subject. Could this be a strategy to continuously harm the crypto industry?