Coinbase offers a fiery response to the SECs threat of enforcement action
Summary
The analysis SEC did staffers to justify an enforcement action "appears to rest on superficial and incorrect analogies to products and services offered by others," Coinbase wrote in a blog post from chief legal officer Paul Grewal. Separately, Grewal told CNBC, "At the time when we went public we had detailed discussions with the SEC about the very aspects of our business that are now — two years later — the subject of the Wells notice. To date, the SEC has never approved a crypto-asset entity as an national securities exchange, despite an extensive dialogue with Coinbase over the years. Perhaps most consequentially for the rest of the U.S. crypto industry, Coinbase also argues that proposed charges rely on "flawed and untested" theories involving investment contracts, spot markets, and custody services. Courts have already been reluctant to extend "Howeys reach to include the secondary trading of assets where no issuer is involved," Coinbases response noted.