SEC Denies Coinbase's Request for Clear Crypto Regulations

According to a statement on December 15, the US Securities and Exchange Commission rejected Coinbase's request for transparent crypto rules.

This follows Coinbase's filing of a limited action in federal court that would force the U.S. Securities and Exchange Commission (SEC) to answer yes or no to a July 2022 petition asking the SEC to use its formal regulatory process.

Regulate investments under any name

On December 15, Chairman Gary Gensler announced the SEC's denial of Coinbase Regulatory Petitionciting three reasons: existing laws already apply to crypto securities markets, the SEC addresses crypto securities markets through rulemaking, and the need to preserve the Commission's discretion in setting priorities in rulemaking. .

The statement highlights the principles outlined in Howey and Reves, which have effectively guided analyzes of various types of investments for decades and prioritize the economic substance of transactions over labels or forms.

Gensler adds that over the years, federal courts have consistently applied these Supreme Court precedents to various crypto assets, with no court finding these standards impractical for evaluating the specific facts and circumstances of a crypto asset.

Gensler wants to work with cryptocurrencies

Gensler concludes that, unlike community comments that suggest he is against innovation, he is on the side of compliance.

“As I said before the collapse of one of the largest non-compliant crypto brokers that cost investors billions of dollars, a meaningful engagement with the SEC is always welcome,” Gensler says in the statement's conclusion. . “I look forward to working with crypto brokers and projects that want to comply with the law.”