Leading crypto organizations, including the Crypto Council for Innovation, crypto investment firm Paradigm, and the U.S. Chamber of Commerce, have voiced their support for Coinbase’s advocacy for the Securities and Exchange Commission (SEC) to develop clear regulatory guidelines for the cryptocurrency industry.
In amicus briefs submitted to the Court of Appeals for the Third Circuit on Monday, these groups underscored the pressing need for regulatory clarity in the crypto space, citing concerns over the SEC’s ambiguous regulatory approach and its potential adverse impact on businesses operating within the United States.
The ongoing dispute between Coinbase and the SEC has revolved around the necessity of tailored regulatory frameworks for crypto. Despite Coinbase’s persistent requests for formal rulemaking, the SEC has refrained from issuing specific regulations for the industry, prompting Coinbase’s recent legal action seeking a definitive response from the agency. Last week, Coinbase filed an appeal urging the appeals court to compel the SEC to initiate the rule-writing process for crypto.
The crypto industry’s call for regulatory clarity comes amidst the SEC’s enforcement actions against numerous major crypto firms, including Coinbase, accused of operating as unregistered exchanges.
In its amicus brief, the Crypto Council for Innovation criticized the SEC’s lack of formal rulemaking, describing its enforcement policies as arbitrary and detrimental to industry participants. The U.S. Chamber of Commerce echoed these sentiments, emphasizing the adverse economic implications of the SEC’s regulatory uncertainty for investors and the broader digital asset economy.
Paradigm, in its brief, highlighted the fundamental differences between crypto assets and traditional securities, arguing that the SEC’s existing regulatory framework is ill-suited to the decentralized nature of crypto networks. The firm underscored the inadequacy of conventional disclosure requirements imposed by the SEC, asserting that they fail to capture the unique dynamics of the crypto ecosystem.
Collectively, these amicus briefs emphasize the urgent need for the SEC to provide clear and coherent regulatory guidance tailored to the evolving needs of the crypto industry, fostering innovation while safeguarding investor interests.