Coinbase Global Inc, one of the world’s largest cryptocurrency exchanges, is suing the U.S. Securities and Exchange Commission (SEC. The reason is that it says is the agency’s refusal to provide clear guidelines on how to comply with its regulations.
The lawsuit centers on a loan product offered by Coinbase, for which the SEC has threatened to sue the company, claiming it violates securities laws. Coinbase claims that its product is not a security and that the SEC has not provided clear guidance on how to determine whether a crypto is a security or not.
As a reminder, Coinbase isn’t the only one frustrated by the SEC’s lack of clarity. Many in the crypto industry have criticized the agency for its inconsistent and sometimes contradictory approach to regulating the industry, which they say has hindered its growth and development.
Brian Armstrong, CEO of Coinbase, actually recently stated that if the US does not put in place a clear regulatory framework for the crypto sector, his company could simply leave US soil.
Faced with this blatant lack of clarity on the part of the US regulator, which is chasing crypto companies through the courts, Coinbase is therefore taking the bull by the horns by suing the SEC to answer a 50-question petition sent by the crypto exchange in July 2022, which has remained unanswered.
Paul Grewal, Coinbase’s general counsel, said:
Today, we filed a narrow action in US Circuit Court to compel the SEC to answer ‘yes or no’ to a petition for rulemaking we filed with it last July asking it to provide regulatory guidance for the crypto industry.
While the U.S. SEC has already shut down crypto exchange Beaxy, and is now suing Bittrex, Coinbase is certainly taking the lead in order to not suffer the same fate by demanding clear answers as to the regulation of the crypto industry.