The US Securities and Exchange Commission (SEC) has rejected a petition from Coinbase, the largest crypto exchange in the US, seeking exemptions for certain crypto assets to be treated as commodities rather than securities. SEC Chair Gary Gensler provided three reasons for the denial. Firstly, he emphasized that existing laws and regulations already apply to crypto securities markets. Secondly, he stated that the SEC is currently seeking comments on crypto-related rules, making it an inappropriate time for Coinbase’s proposed rulemaking. Lastly, Gensler highlighted the importance of preserving the Commission’s discretion in determining its rulemaking priorities.
Gensler further explained that the current laws and regulations governing securities markets also apply to crypto securities markets. He noted that there is nothing about the crypto securities markets that suggests investors and issuers are less deserving of the protections provided by securities laws. He referred to the broad definition of “securities” under existing laws, which includes various forms of investments. Gensler also mentioned the Supreme Court’s Howey Test, which defines securities as money investments in a joint enterprise with the expectation of profit derived from others’ efforts.
In response to the SEC’s decision, Coinbase’s Chief Legal Officer Paul Grewal has challenged it in court. Grewal stated that they are now on file with the Third Circuit to challenge the SEC’s denial of their petition for crypto rulemaking.
While the Commodity Futures Trading Commission (CFTC) Chair Rostin Behnam considers assets like Ether and Bitcoin to be commodities, Gensler believes that the public invests in crypto with the expectation of profits. The regulatory uncertainty and turf war between regulatory agencies have discouraged some crypto firms from operating in the US. Investors and industry players are seeking quicker resolution and guidance to overcome these challenges.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | Gary Gensler, Paul Grewal, Rostin Behnam |
| Companies | Commodity Futures Trading Commission (CFTC), Coinbase, Supreme Court, US Securities and Exchange Commission (SEC) |
| Currencies | Bitcoin, Lido Staked Ether |
| Securities | None |
