John Deaton, a legal representative for Ripple (XRP) holders, recently shared his perspective on Coinbase’s response to the Wells Notice issued by the Securities and Exchange Commission (SEC) in March. Deaton’s views are of great significance to the ongoing legal battle surrounding Ripple and its classification as a security.
On his Twitter account, Deaton praised Coinbase for demonstrating a solid and unwavering conviction while also offering to engage in dialogue and cooperation. Deaton stated that Coinbase’s actions showed a willingness to collaborate while remaining steadfast in their beliefs.
According to the terms of the Wells notice, Coinbase must provide a written response outlining why the SEC should not pursue legal action against the company. Coinbase must provide a well-reasoned and compelling defense to justify its actions regarding digital assets.
Per the Wells notice, the digital assets in question are Coinbase Earn, Coinbase Prime, and Coinbase Wallet.
Upon receiving notice from the SEC, Coinbase CEO Brian Armstrong and General Counsel Paul Grewal have declared their readiness to defend the U.S.-based crypto exchange in court against any legal allegations. Furthermore, they have challenged the regulatory watchdog for its failure to provide clear guidance on the regulations governing the cryptocurrency sector in the U.S.
During a recent congressional hearing, SEC Chair Gary Gensler was asked to classify cryptocurrencies as either securities or commodities. However, Gensler needed to provide a clear answer to the question.
In recent months, the SEC has been intensifying its scrutiny of the cryptocurrency industry, and not only Coinbase but also other exchanges have received a Wells Notice.
Coinbase’s response indicates that the company is ready to contest any legal action the SEC might take in court. The SEC’s next moves and the situation’s evolution are still unclear.
Armstrong recently requested Congress to intervene in the regulatory framework of the cryptocurrency industry in the U.S. He urged them to provide more straightforward guidelines to enhance the transparency in this sector.