The Securities and Exchange Commission (SEC) has been chastised by the US Chamber of Commerce for its “haphazard, enforcement-based approach” to regulating the cryptocurrency industry on American soil.
The US Chamber of Commerce threw its entire weight behind Coinbase in an amicus brief filed to the US Court of Appeals on May 9, accusing the SEC of purposefully creating a risky and uncertain situation for crypto firms operating in the country.
“The SEC has deliberately muddied the waters by claiming sweeping authority over digital assets while deploying a haphazard, enforcement-based approach,” it stated.
“This regulatory chaos is deliberate, not accidental.”
An “amicus brief” is derived from the Latin term “friend of the court” and refers to advice or information offered by other parties who are not officially involved in a particular court action.
Furthermore, the Chamber of Commerce urged the SEC to respond quickly to Coinbase’s April 25 complaint, which seeks to compel the regulator to respond to its “petition for rulemaking” and offer clearer regulatory rules for crypto businesses operating in the country.
The complaint was filed after the SEC sent a Wells notice to the crypto exchange in March regarding the company’s “potential violation” of US securities law.
It’s worth noting that Coinbase’s complaint does not ask the court to compel the SEC to enact new cryptocurrency standards. Instead, the exchange just asks for a response to the commission’s July appeal, which it is constitutionally obliged to receive within a “reasonable amount of time.”
In a direct response to this point, the Chamber of Commerce said that the SEC’s “refusal” to react to Coinbase or “otherwise engage in any rulemaking” is not only damaging, but also illegal. “The SEC’s actions are not only bad policy; they are also illegal, and the consequences of the SEC’s continued delay are severe.”
The Chamber of Commerce also chastised the financial regulator for failing to provide a clear answer to the question of whether any of the approximately 20,000 digital assets presently in existence could be classified as “securities” under Federal Law.
It emphasized that the answer to this question will have “immense implications” for “every person involved” in the burgeoning $1 trillion digital-asset ecosystem. “Remarkably, the Securities and Exchange Commission — despite proclaiming itself to be the primary regulator of digital assets — has refused to resolve this threshold question.”
The Chamber of Commerce isn’t the only one offering legal assistance to Coinbase. The crypto investment business founded by Coinbase co-founder Fred Ehrsam has filed another amicus brief in support of the crypto exchange, arguing that the SEC’s actions have “crippled a nascent industry.”