Coinbase Persists in Urging SEC Action on Crypto Rulemaking Petition

Coinbase is intensifying its efforts to press the United States Securities and Exchange Commission (SEC) into action regarding the company’s crypto rulemaking petition. The cryptocurrency exchange platform is seeking a mandamus, a court order compelling the SEC to respond definitively to their petition within 30 days.

The SEC, after a prolonged delay, submitted a status update on October 12, vaguely stating that “commission staff provided a recommendation” to the SEC regarding Coinbase’s petition but offering no specific details.

In response, Coinbase’s chief legal officer, Paul Grewal, took to X (formerly Twitter) on October 13, criticizing the SEC’s sluggish response. He called for a mandamus to force the SEC to clearly outline its intentions. Coinbase shared its response to the SEC’s update with the U.S. Court of Appeals for the Third Circuit, expressing frustration with the SEC’s lack of transparency.

According to Coinbase, the SEC’s report is merely bureaucratic maneuvering, demonstrating the agency’s reluctance to fulfill its obligations. The response noted that it took more than a year and a court order to extract even a staff-level recommendation from the SEC. Coinbase firmly stated that the Commission had resolved not to conduct the requested rulemaking and was employing various bureaucratic tactics to delay judicial review.

Coinbase had initially filed the rulemaking petition in July 2022, urging the SEC to create rules governing the cryptocurrency market. These rules would include clear definitions of which digital assets should be classified as securities. Frustrated by the SEC’s lack of response, Coinbase filed a mandamus petition nine months later, seeking a definitive “yes or no” answer from the agency.

Despite Coinbase’s efforts, the SEC has repeatedly pushed back, contesting the necessity of meeting Coinbase’s demands and urging the court to reject the mandamus petition. In a recent development, the SEC requested an additional 120 days to respond to the rulemaking petition. This timeline indicates that the agency might provide an answer by the end of October or early November. The ongoing legal battle highlights the tension between the cryptocurrency industry and regulatory authorities, underscoring the challenges of establishing clear regulations in this rapidly evolving sector.

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