Coinbase, a major player in the cryptocurrency realm, is taking on the US Securities and Exchange Commission (SEC), alleging legal violations for its failure to establish clear regulations for the crypto industry.
In an opening brief filed at the Third Circuit Appeals Court, Coinbase accuses the SEC of acting arbitrarily and capriciously by denying the exchange’s petition for clear crypto guidelines.
The SEC’s refusal to engage in rulemaking and provide a reasoned explanation for denying Coinbase’s petition is deemed a violation of the Administrative Procedure Act, according to the exchange’s brief.
The existing securities laws, as suggested by SEC Chair Gary Gensler, are deemed inadequate and inappropriate for governing crypto assets by Coinbase.
Coinbase highlights the SEC’s inconsistency, citing conflicting statements over the years regarding the regulation of cryptocurrencies, which has created uncertainty within the industry.
This legal action by Coinbase comes amidst a lawsuit filed by the SEC against the exchange, alleging the offering of unregistered securities and operating as an unregistered platform.
Similar lawsuits have been initiated against other leading exchanges, including Binance and Kraken, reflecting the broader regulatory scrutiny faced by the crypto industry.
