Coinbase, a cryptocurrency exchange, has taken legal action against the US Securities and Exchange Commission (SEC) after failing to receive a response to a petition it submitted in July 2022.
The petition requested that the SEC adopt clear rules and regulations for the cryptocurrency industry in the United States.
The exchange asked approximately 50 questions related to the supervision of digital assets and the criteria for classifying cryptocurrencies as securities.
Coinbase’s General Counsel, Paul Grewal, argued that the SEC was required to respond to the petition within a reasonable time frame under the Administrative Procedure Act.
Grewal noted that the lack of clarity on these matters was concerning, especially as Coinbase had received a notice from the SEC in March regarding possible enforcement action for the sale of unregistered securities.
Other crypto companies, including Kraken, have faced similar actions from the SEC, prompting criticism from SEC Commissioner Hester Peirce for being ineffective and unfair.
The cryptocurrency industry requires clear laws and regulations that suit the latest technologies, and enforcement action based on securities laws that do not apply to cryptocurrencies is not a viable solution.