Coinbase’s CLO Says SEC Is Ignoring Federal Court Questions

The chief legal officer of Coinbase says that the U.S. Securities and Exchange Commission (SEC) is ignoring questions from a federal court about the crypto exchange’s request for regulatory explanation.

In a long thread, Paul Grewal says that the SEC is giving vague answers to the Third Circuit’s questions, which is “unusual.”

Grewal says that because the regulator didn’t come up with a good answer, the court should give mandamus, which is an order for a person or group to do something they are legally required to do as part of their public job.

“We couldn’t wait until our deadline next week to address the SEC’s response to the June 6 order from the Third Circuit. It is unusual for the government to defy a direct question from a federal court. But the SEC’s evasive response goes further, as we set out today.

The Court should grant mandamus now because the Commission has decided not to grant Coinbase’s rulemaking petition and is actively harming the industry.”

In April, Coinbase filed a motion to force the SEC to answer a petition from the company asking for advice on how to regulate the new cryptocurrency industry.

The U.S. Court of Appeals for the Third Circuit said earlier this month that the SEC has seven days to respond to Coinbase’s request.

A few days later, the government agency replied that Coinbase’s move had “no merit.”

Grewal says that the fact that the SEC won’t say how long it will take to reply shows that their delays are “futile.”

“The Commission’s refusal to say how much additional time it needs to act on Coinbase’s petition confirms that further delay is futile.

At a minimum, the Court should order the Commission to report on its action – not a ‘anticipated’ staff ‘recommendation’ – in no more than 60 days and decide the mandamus petition promptly if the Commission still has not acted at that time.”