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Coinbase Urges Court to Compel SEC Action on Rulemaking Petition

Bitcoinist

Bitcoin News / Bitcoinist 97 Views

Coinbase has intensified efforts to force the hand of the United States Securities and Exchange Commission (SEC) on its crypto rulemaking petition. The firm has submitted a formal response to the Third Circuit regarding the SEC’s recent update on its rulemaking request.

Coinbase Files For Mandamus Again In Latest Response

As earlier reported by Bitcoinist, the SEC staff tendered a recommendation to the Commission on October 10, 2023, following Coinbase’s mandamus request in April. This mandamus petition sought a prompt response to the crypto company’s rulemaking appeal in July 2022.

Coinbase has, however, expressed dissatisfaction and frustration with the latest SEC update, believing it raises more questions than answers. The firm asserted that a “formal, public” response to the petition is long overdue while stating the need for the financial regulator to communicate the timeline for its decision.

Coinbase Chief Legal Officer Paul Grewal also criticized the SEC via a post on X (formerly Twitter) for continuing to delay its response to the firm’s crypto rulemaking petition. According to the October 14 post, Coinbase has filed a response with the Third Circuit, urging the court to grant a mandamus compelling the Securities and Exchange Commission to act on the rulemaking petition.

A part of the response read: 

The SEC’s unilluminating “update” is mere bureaucratic pantomime and confirms that nothing short of mandamus will prompt the agency to take its obligations seriously. It took more than a year and an order from this Court to elicit even a staff-level recommendation, and even now, the Commission will not commit to action or even bother to inform the Court of its intentions.

Is The SEC Fearful Of Judicial Review?

In the court filing, Coinbase argued that the SEC’s October 11 response was another attempt at delaying a judicial review of its already-made decision to deny the rulemaking petition. “Evidently, then, the Commission is ready to rule officially on Coinbase’s petition but is simply unwilling to do so absent a court order,” the crypto firm added.

Furthermore, Coinbase alleged that the Securities and Exchange Commission has simply resolved not to honor the crypto rulemaking request. And the firm reckons that the agency will employ every “bureaucratic artifice in its arsenal” to block judicial review as long as the court allows it.

For this reason, Coinbase believes that a writ of mandamus is necessary to “hold the SEC accountable.” So I n its latest letter to the Third Circuit, the crypto company asked the court to issue an order directing the Commission to act on the rulemaking petition within 30 days.

Coinbase continues to dispute the SEC’s claims that it operated unlawfully as a national securities exchange, broker, and clearing agency without proper registration in another ongoing legal tussle. However, in a recent development, the SEC asked a federal judge to reject the crypto firm’s request to dismiss the regulator’s lawsuit.

Coinbase


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