Bitcoin

Big Defeat for SEC’s Gensler: Coinbase Secures Partial Win

In a major legal development, the United States Securities and Exchange Commission (SEC), led by Gary Gensler, has suffered a setback in its ongoing battle with Coinbase. This is another loss for the SEC, following a string of defeats in recent crypto-related cases.

Court reprimands SEC actions

Coinbase won its mandamus petition with the Third Circuit Court of Appeals, which chastised the SEC for denying its request for clearer rules regarding the regulation of digital assets. The court found the SEC’s order insufficiently reasoned and arbitrary, calling it “conclusive” and “capricious.” This decision forces the SEC to reconsider its position and provide a more thorough explanation for its refusal to create specific rules governing the regulation of cryptocurrencies.

Paul Grewal, Coinbase’s chief legal officer, took to Twitter to celebrate the victory, saying: “We just won our petition for a writ of mandamus to the Third Circuit reprimanding the SEC for its order denying our request for regulation. » He said the court’s decision highlighted the SEC’s failure to provide adequate motivation for its actions.

“We also appreciate Justice Bibas’ agreement, in which he speaks forcefully about the looming constitutional concerns ‘with ex post application without announcing ex ante rules or guidance.’ This is an impressive piece of work,” he wrote.

A loss model for the SEC

The move adds to a growing list of losses for the SEC under Gensler’s leadership. The agency has been criticized for its arbitrary decision-making in several cases, including the rejection of the Grayscale Bitcoin ETF, where the SEC has also been criticized for its lack of justification. Legal experts have long criticized the SEC’s approach to crypto regulation, accusing the agency of overreach and bias.

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