A recent ruling by the Third Circuit Court of Appeals gave Coinbase an edge in its legal battle with the Securities and Exchange Commission (SEC) over allegations of offering unregistered securities products. The court ordered the Securities and Exchange Commission to provide a legal basis for its failure to respond to a 2022 petition calling for formal rules in the digital asset sector.
The Third Circuit Court of Appeals ruled that the SEC must file its response within 10 days, followed by Coinbase’s response seven days later.
According to Coinbase, the SEC has not provided sufficient regulatory guidance for US crypto firms. At a minimum, they argue, the commission should “determine how to adapt those inappropriate and inappropriate requirements to digital assets.”
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Coinbase also cited a 2022 petition asking for formal rules in the digital asset sector, which the SEC has not yet responded to. The court’s 10-day deadline for the SEC to provide a legal basis for its failure to respond to the petition is an important step in Coinbase’s legal battle with the commission.
In March, the Securities and Exchange Commission announced its intention to sue Coinbase for allegedly offering unregistered securities products. Coinbase is trying to take a proactive approach to this issue, and a recent court ruling has given it an edge in the ongoing legal battle.
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Regulation of the cryptocurrency industry continues to be a topic of debate and controversy, and the outcome of this case is likely to have far-reaching implications for the industry as a whole.
The 3rd Circuit Court of Appeals ruling marks a significant milestone in the legal action between Coinbase and the SEC.
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