Coinbase filed a suit against the SEC. No, they aren't asking the SEC to rule for or against crypto... they are simply asking the SEC to rule on crypto.
Basically, they're shaking Gensler to wake up and answer with... well, anything.
ICYMI, there was an incredibly cringe (and funny) hearing where Gensler was questioned on his actions at the SEC and his overall views on the Crypto Industry. When asked "Is ETH a security" for example, he could not answer a simple "Yes or No".
This is just exhibit A of a longer period of silence from Gensler and the SEC. This silence has negatively impacted the crypto industry, companies like Coinbase, retail/institutional investors and most importantly; the USA's ability to remain innovative and competitive on a global landscape.
SEC Failing to Make Up Their Mind
"From the SEC’s public statements and enforcement activity in the crypto industry, it seems like the SEC has already made up its mind to deny our petition. But they haven’t told the public yet. So the action Coinbase filed today simply asks the court to ask the SEC to share its decision. This step may feel unusual, and it is, because this step is usually not needed. But it is also unusual for an agency to bring enforcement actions based on a view of the law that it has not yet shared formally with the public." (my emphasis)
"it is also unusual for an agency to bring enforcement actions based on a view of the law that it has not yet shared formally with the public"
That part really sticks out to me. If you watched the hearing where Gensler was questioned, you definitely saw this take place. It was an absolute shit show. You can clearly see that he has a negative view of crypto & digital assets, but he is not willing to explicitly say that.
He is unwilling to take a side.
Coinbase isn't Asking For a Pro-Crypto Stance
"Coinbase is not asking the Court to instruct the agency how to respond. We are simply requesting that the Court order the SEC to respond at all, which they are legally obligated to do." (my emphasis)
It could be understandable for the SEC to not respond well to Coinbase's suit if CB was asking the SEC to take a particular stance on crypto.
That isn't the case. Coinbase is simply asking the SEC to publicly declare their stance on crypto. That's it. They're not asking for a ruling for or against crypto in particular. They are simply saying that the silence the SEC has had is negatively impacting their business and their ability to grow as a U.S. based company.
Yet Coinbase and other crypto companies are facing potential regulatory enforcement actions from the SEC, even though we have not been told how the SEC believes the law applies to our business.
Coinbase as a US Company
At Coinbase, we believe crypto and blockchain technology have the ability to increase economic freedom and opportunity around the world.
Coinbase has discussed leaving the US. This is strictly because of a lack of clarity from regulators. Can you blame them? They're building a business and have been doing so for the better part of a decade and yet they are whipsawed in every direction.
They went through the paces of becoming a publicly traded company. They probably even thought they were in the clear from regulators once they got approved to be a publicly traded company. All of the scrutiny that a company has to go through to be public...
Yet, a new SEC head steps in and suddenly the ground is pulled from underneath them. They have no clarity on whether the regulators are on their side or not. They can't even get a simple yes or no to whether ETH is a security and they can have it listed on their exchange.
Coinbase decided to become a public company in the US because we believe America is well suited to lead the technological transformation enabled by blockchain technology. But government leaders and regulators at the federal level have adopted a disjointed, regulation-by-enforcement approach that has the potential to negatively impact American competitiveness and national security.
After watching the hearing, I think it's blatantly obvious that there is a camp of people out there (me included) that believe that Gary Gensler is actively hurting the United States.
In a time when the US needs to buckle down and bolster our in-house manufacturing of goods & services, we have a regulator who is actively scaring off innovative companies who could bring jobs and prosperity to the US economy.
Instead of fostering innovation and supporting it, we have regulators who are trying to make a name for themselves by scaring companies into leaving US borders and fleeing overseas. China even came out and said that they would like to build relationships with Crypto Companies.
Imagine if a company like Coinbase fled to China to be "safe" from US regulation?
Land of the free. Innovative capitalism. This is what built America into an empire. There exists a body of people who are actively trying to tear this down. They've somehow made it up the ranks in the government and it's time to take them out of power.
The US has so much potential to capitalize on the crypto industry. I just hope regulators wake up and see this before all of the intellectual capital, great companies and innovators leave.
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