Cryptocurrency
exchange Coinbase has filed its first legal response to the Securities
and Exchange Commission’s (SEC) allegations, saying the claims “lack all
merit.” It also argued that were SEC’s assertion of regulatory power over its cryptocurrency
services correct, the watchdog’s action violates its “due process rights and
constitutes an extraordinary abuse of process.”
In early
June, the SEC filed a lawsuit against
Coinbase, alleging
that the largest crypto exchange in the United States, is operating with an
unauthorized trading platform and offers unregistered securities. The financial
watchdog also accused Coinbase of running a digital asset staking-as-a-service
programme without permission.
However, in
its 177-page-long response submitted to the district court
in New York yesterday (Wednesday), Coinbase
said it is not and has never been a securities exchange, broker or clearing
agency. It also argued that cryptocurrencies traded on its platform fall
outside the SEC’s authority because they are not ‘investment contracts’ or assets
pooled from investors to engage in businesses and pay them with profits. Without
this obligation, Coinbase’s listed crypto are not ‘securities’ but ‘just an
asset sale,’ the exchange contended.
Cryptocurrency
exchange Coinbase has filed its first legal response to the Securities
and Exchange Commission’s (SEC) allegations, saying the claims “lack all
merit.” It also argued that were SEC’s assertion of regulatory power over its cryptocurrency
services correct, the watchdog’s action violates its “due process rights and
constitutes an extraordinary abuse of process.”
In early
June, the SEC filed a lawsuit against
Coinbase, alleging
that the largest crypto exchange in the United States, is operating with an
unauthorized trading platform and offers unregistered securities. The financial
watchdog also accused Coinbase of running a digital asset staking-as-a-service
programme without permission.
However, in
its 177-page-long response submitted to the district court
in New York yesterday (Wednesday), Coinbase
said it is not and has never been a securities exchange, broker or clearing
agency. It also argued that cryptocurrencies traded on its platform fall
outside the SEC’s authority because they are not ‘investment contracts’ or assets
pooled from investors to engage in businesses and pay them with profits. Without
this obligation, Coinbase’s listed crypto are not ‘securities’ but ‘just an
asset sale,’ the exchange contended.
