Coinbase Head of Legal Disputes SEC Entire Power Over Crypto Industry
Paul Grewal, Coinbase’s Head of Legal, has expressed his concerns about how the extensive security laws of the United States Securities and Exchange Commission (SEC) are hampering the progress of the crypto industry. He believes that comprehensive crypto legislation needs to be passed in the US to put an end to these distortions.
In a series of posts on X (formerly Twitter), Grewal challenges the SEC’s alleged belief that it has unlimited control over the crypto industry. He specifically mentions that the SEC asserts that a virtually unlimited “flexibility of the securities laws” grants it complete authority over crypto exchanges, which he believes misrepresents the law.
Grewal also disputes that the SEC fails to prove that cryptos are securities, referring to an absolute requirement of an investment contract as defined by the Supreme Court in Howey.
Meanwhile, crypto enthusiasts have been actively following which cryptos the SEC is labeling as securities. On June 5, it was reported that the SEC outlined in its lawsuit against Binance that several cryptos were securities, subsequently causing the price of these tokens to decline. These included Solana (SOL), Cardano (ADA), Polygon (MATIC), and Cosmos (ATOM).
Learn more: What Does It Mean To Receive a Wells Notice From the SEC?
Binance’s Constant Efforts To Dismiss SEC’s Lawsuit
This comes not long after Binance, Binance.US, and CEO Changpeng “CZ” Zhao requested the SEC to drop its lawsuit against them. The entities along with CZ claim that the SEC’s alleged charges “fail as a matter of law.” Furthermore, they contest the classification of BNB, a token launched by Binance, as a security during its initial coin offering (ICO) phase.
Learn more: Binance Review 2023: Is It the Right Crypto Exchange for You?
Hot Take
The ongoing dispute between Coinbase’s legal head and the SEC highlights the need for comprehensive crypto legislation in the US. Additionally, Binance’s constant efforts to dismiss the SEC’s lawsuit indicate a growing tension between regulatory authorities and major players in the crypto industry.
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