Coinbase is demanding the disclosure of documents related to cryptocurrency regulations in its lawsuit against the US Securities and Exchange Commission (SEC). The company filed a petition seeking partial summary judgment in the Washington, D.C. District Court.
Coinbase Requests Internal Documents from SEC
Coinbase, History Associates Inc. Requests the SEC’s internal documents regarding cryptocurrency practices. The company’s legal team claims that the SEC prevented it from disclosing these documents.
The SEC proposed a three-year delay to decide whether the requested information should be released. Coinbase criticized the SEC for prolonging this process. The petition follows Coinbase’s lawsuit against the SEC and the Federal Deposit Insurance Corporation in June 2023. The company maintains that FOIA requests were not met.
SEC’s Role in Crypto Regulation
Coinbase wants to understand the SEC’s process for deciding whether certain assets, such as Ether (ETH), are securities. This could have significant consequences for the crypto industry.
Paul Grewal, Coinbase’s Chief Legal Officer, said that the SEC’s release of the requested documents will not occur until the end of the year.
Coinbase’s request also follows a lawsuit filed by blockchain firm ConsenSys against the SEC in April. ConsenSys also expressed its views against the SEC’s practices that exceed its authority. In a separate lawsuit filed against Coinbase last year, the SEC accused Coinbase of offering some of its products without a registered exchange.
History Associates Inc filed a complaint alleging the SEC was slowing down the document disclosure process. The company criticizes the SEC’s lack of transparency in cryptocurrency regulations.
This move by Coinbase could be a major legal turning point in how crypto assets will be valued under securities laws in the United States.
Other companies, such as Cryptocom, are also combating regulatory uncertainty by taking similar legal action against the SEC. Clarifying the basis on which the SEC classifies cryptocurrencies as securities will also affect the course of ongoing cases. Although the SEC refers to the Howey test every time, this test cannot be applied in all aspects of crypto. For this very reason, SEC officials defend the view that the relevant asset can be recognized as a security “even in cases where the test finds a partial answer.”
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
