Cryptocurrency exchange Coinbase has filed an amicus brief on behalf of Beba Collection and Fund Defi to stop the regulator the Securities and Exchange Commission (SEC) from implementing some of its “retrogressive” laws.
This comes as the SEC has waged war against law-abiding citizens through rules and regulations that reportedly stifle growth and innovation.
SEC has reportedly become destructive in their rules and regulations, without providing clarity on what constitutes legal and illegal activity. The regulator itself is reportedly not clear on what is deemed law and what is not.
Coinbase takes its fight against the SEC further
While SEC claims that the “existing” rules work for digital assets, the regulator does not indicate as to when the rules apply or how the digital asset companies must comply.
As shown by Coinbase’s chief legal officer (CLO) Paul Grewal, crypto and related firms are facing punitive “retroactive SEC enforcement actions, failing to achieve the impossible.”
Now, with the amicus brief, Coinbase is escalating its fight against the regulator, this time by directly countering its claims that either DeFi Education Fund or Beba violated Federal Security Laws.
Currently, the lawsuit between the regulator and the exchange is still before the courts, reflecting its commitment to support other Web3 firms that are battling the same regulatory atrocities.
However, in its amicus brief, the crypto exchange has claimed that the regulator has provided different answers to the same questions. In one incident, Coinbase revealed that the regulator had said digital assets are not securities in 2018. According to Coinbase, the SEC changed positions in 2021 when it said that digital assets represent investment contracts.
Coinbase accuses SEC of failing to provide clarity
The crypto exchange is now supporting Beba and the DeFi Education Fund on grounds that the regulator has thus far refused to provide the needed clarity.
“In the past few years, however, the SEC has unleashed an arbitrary regulation-by-enforcement campaign on digital assets. The plaintiffs here—Beba and the DeFi Education Fund—are two of the many victims of the SEC’s onslaught,” reads part of the Amicus brief.
According to the filing, Coinbase and others have repeatably shown the SEC, digital asset firms cannot comply with the SEC’s existing rules.
“At the most basic level, if many digital assets had to be registered as securities, they simply could not function.”
Coinbase.
“All digital-asset transactions would have to be routed through a broker-dealer on a registered exchange, subjecting them to clearing and settlement rules that would not permit the real-time uses for which the assets are designed,” added Coinbase.
Several other crypto firms are expecting a likely suit from the regulator, at a time that Beba and DeFi Education Fund continue to tussle.
OpenSea received a Wells Notice from the regulator earlier this year. SEC claimed the non-tangible tokens (NFTs) it hosts on its platform are investment contracts
Earlier this year, OpenSea received a Wells Notice from the US SEC. The Gary Gensler-led watchdog claimed that the Non-Fungible Tokens (NFTs) it hosts on its platform are investment contracts.
Other firms, Robinhood and Uniswap, both served a Wells Notice as part of the SEC’s regulatory campaign.
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