The US Court of Appeals for the Third Circuit has responded to a complaint against the US Securities and Exchange Commission (SEC) that digital asset trading needs clear rules, according to a May 4 announcement by Coinbase Chief Legal Officer Paul Grewal. It marks progress in the legal battle for regulatory clarity.
According to Grewal, the court's response to their complaint with the SEC was a plain text order. The court has directed the SEC to respond to Coinbase's enforcement order within ten days. A written of execution is an order issued by a court to lower-level Government officials ordering them to perform their duties properly. Grewal said the court has given Coinbase the right to respond to the SEC's response within seven days of the filing. He also recommended the court for its thorough review of the case.
Coinbase, the largest US cryptocurrency exchange, filed a lawsuit in April asking the court to compel the SEC to publicly disclose its position on a petition filed months earlier. In the petition, the exchange raises 50 specific questions about its regulatory tr eating of certain digital assets . The questions are wide-ranging, covering topics such as how tokens are classified as securities and seeking clarification on various other issues.
Despite the lack of public response to the petition, the SEC stepped up enforcement and issued warnings to cryptocurrency exchanges. The commission has even sent a Wells notice to Coinbase in the past. Wells notification letters typically warn companies of potential SEC enforcement act ion. bank Citigroup downgraded the cryptocurrency exchange's stock rating to "neutral" from "buy" and lowered its price target due to ongoing regulatory issues facing the company. The bank cited "too many unknowns" as the reason for the downgrade. According to Citi ana Lyst Peter Christiansen, the downgrade will come before the US better establishes regulatory "rules of the road".
