Coinbase, the prominent cryptocurrency exchange in America, has recently filed a motion aiming to dismiss a lawsuit by the Securities and Exchange Commission (SEC). The company strongly asserts that the regulator’s accusations of offering unregistered securities are unfounded and lack legitimate legal grounds.
Coinbase filed a motion on Thursday, June 29th, with the U.S. District Court for the Southern District of New York. The motion asserts that the SEC is applying securities laws in a manner that significantly diverges from established legal frameworks when it comes to specific digital tokens.
The Securities and Exchange Commission (SEC) recently filed a lawsuit accusing Coinbase of enabling unregistered trading in 12 digital tokens that the regulator considers securities. These tokens include Solana, Cardano, Polygon MATIC, The Sandbox, Flow, Internet Computer ICP Near, and Dash.
Coinbase has strongly contested the claim, firmly asserting that none of the assets listed on its exchange can be classified as securities. In addition, the company confidently stated that before going public in April 2021, Coinbase underwent an extensive review of its business practices by the SEC.
In a recent tweet on June 29th, Paul Grewal, the chief legal officer of Coinbase, expressed his opinion regarding the claims made by the SEC. He stated that these claims surpass current legal boundaries and should be dismissed accordingly.
Today @coinbase filed our answer and notice of intent to file a motion to dismiss the @SECGov case against us. You can read our response for yourself – our arguments speak for themselves. 1/2 https://t.co/Ld2ZEejhyM
— paulgrewal.eth (@iampaulgrewal) June 29, 2023
During an interview with Bloomberg TV on Thursday, Grewal asserted that Coinbase strictly refrains from listing securities. Furthermore, He emphasized that the token listings evaluated by the SEC in early 2021 underwent an identical review process at Coinbase.
We have always looked to add assets that are appropriate for not only our customers, but consistent with our lawful authority.
Coinbase Seeks writ Of Mandamus From Court
Coinbase requested the dismissal of the lawsuit and urged the court to issue a writ of mandamus, compelling the SEC to respond within seven days to its July petition or explain the reasons for its delay and present a timeline for its response.
Furthermore, Coinbase also requested the court to order the SEC to disclose documents and information about how it decides on digital tokens. The company criticized the SEC for not offering clear guidance or rationale.
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Grewal tweeted that they welcome dialogue with any regulator, including the SEC, and support new legislation and rulemaking as the way forward. Still, they believe that the claims, in this case, should be dismissed because they surpass existing law.