U.S. regulators, particularly the Securities and Exchange Commission (SEC), are at odds with the crypto industry and crypto companies. The SEC is primarily concerned with whether crypto companies are registered and whether they advertise securities. However, many major crypto industry participants complain about fines imposed by the SEC under the guise of regulation.
The Cryptocurrency Community Blames The SEC
The SEC has been increasing its penalties against crypto companies since 2023, and this time it is accusing Coinbase of not properly classifying its assets as securities.
As we know, the SEC had accused Coinbase employees of insider trading. However, this accusation was also directed at the SEC.
The U.S.-based Chamber of Digital Commerce argued in an expert witness statement the previous day that the case should be dismissed because it reflects the expansion of the SEC’s enforcement campaign to classify secondary market transactions as securities transactions.
“This case reflects a secretive, dramatic and unprecedented attempt to expand the SEC’s jurisdiction and undermines the viability of the U.S. digital asset market,” said Perianne Boring, founder and CEO of the Chamber of Digital Commerce.
Is The SEC Abusing Its Authority?
According to the Chamber, Congress has not authorized the SEC to intervene in the digital asset market, and previous Supreme Court decisions have established that regulators must first be authorized by Congress.
The Chamber also pointed out that the SEC has taken many steps without congressional authorization, resulting in a more unstable enforcement environment.
In its statement, the Chamber referenced the case of LBRY v. SEC, in which the judge ruled that secondary market transactions are not securities transactions.
The latest opinion followed a similar motion filed Feb. 13 by the Blockchain Association, which claimed that the SEC had exceeded its authority in this regard.
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