Coinbase the First Crypto Exchange to Officially Sue SEC?

• The court filing requires SEC to “respond yes or no” to its rulemaking petition. 
• Over 1,700 crypto entities and users signed up as of now demanding regulatory clarity.
• Coinbase launches “Stand with Crypto”, a commemorative NFT for global crypto policy.

Crypto exchange Coinbase initiated a solid move against the U.S. Securities and Exchange Commission (SEC). On Monday, the exchange sued SEC, urging the court to compel the regulator to respond to its rulemaking petition. 

Paul Grewal, Chief Legal Officer at Coinbase, tweeted:

“The SEC is required by law to respond to petitions “within a reasonable time,” but they have not yet responded to our petition from last July, which is why we filed our action in court today.”

The crypto community sees SEC’s functioning in the recent months after the FTX collapse as “unreasonable” and unclear actions. The regulator began trapping prominent exchanges such as Binance, Bittrex, and now Coinbase under its radar. 

SEC cornered Coinbase by issuing a Wells Notice accusing the crypto exchange’s products and services from token listings to staking. This action of the SEC was prominently criticized in the sector. Neither SEC nor Commodity Futures Trading Commission (CFTC) alleged crypto entities or services stating concrete or clear reason.

Hence, with this move, Coinbase seeks a clear-cut route for crypto regulations in the United States. Parallel to the 3-year Ripple struggle, this crypto exchange began facing regulatory pressure from SEC in 2021. Thus, in July 2022, Coinbase filed a rulemaking petition to lay down regulations for identifying and governing digital assets that are securities. No official response from SEC was recorded. 

Coinbase and Its “Stand With Crypto” Move

Since the start of 2023, Coinbase displayed its sincere initiatives toward the development of pro-crypto policies in the world, especially in the US. Notably, with its campaign, Crypto 435, the exchange aimed to persuade all 435 US congressional districts to take a clear stance on crypto regulations.

Likewise, soon after the Monday suit, the crypto exchange supported the launch of “Stand with Crypto” – a commemorative NFT featuring a blue shield. The main objective of this collection is to protect and promote the future of cryptocurrency through a fair global crypto policy. To the crypto community, Coinbase CEO Brian Armstrong markedly unveiled that he minted one blue shield NFT.

The team stated:

“The Stand with Crypto commemorative NFT is a symbol of unity for the crypto community seeking sensible crypto policy. This is a purely commemorative NFT with an open mint and has no intended utility or value.”

These NFTs are minted and launched via ZORA, a Web3-centric NFT minting program. According to the official website, at the time of writing, the community minted 15,499 NFTs. The team also asserted that they will donate the revenue generated — mint fees — via this collection to vetted organizations through Crypto Advocacy Round. 

Besides their crucial dispute with the regulators, Coinbase prioritized the launch of Base mainnet, its native layer-2 blockchain this year. Furthermore, despite the regulatory crackdown in the US, the Coinbase stock (COIN) gained over 50% year-to-date (YTD) on NASDAQ as per TradingView.

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