Advocacy groups file amicus briefs urging SEC to write crypto regulations

Several advocacy groups have filed amicus briefs in support of Coinbase's appeal, asking the United States Securities and Exchange Commission (SEC) to create clearer regulations for the crypto industry.

In petitions filed on March 18 with the Court of Appeals for the Third Circuit, the Crypto Council for Innovation (CCI), Satoshi Action Fund, Texas Blockchain Council, investment firm Paradigm, digital asset company Legilex and the American Chamber of Commerce said the SEC lacks clear guidelines in the United States. Market participants to follow successfully. Many of the records argued that without a clear road rule, companies would be more inclined to leave the country.

“The uncertainty and paralysis created by the SEC may cause digital asset companies to exit the United States entirely,” according to a joint filing by Satoshi Action Fund and the Texas Blockchain Council. “The need for clear rules with adequate notice based on congressional authority is particularly critical as the SEC seeks to impose ‘adverse consequences' and ‘liability' on the digital asset industry for ‘past actions taken in good faith.' [the SEC’s] Statements.'

The amicus brief supports Coinbase's appeal, which is part of the crypto exchange's July 2022 petition to the SEC to impose rules on tokens it deems to be securities under its control. The commission dismissed the petition in December 2023, nearly six months after filing an enforcement action against Coinbase for alleged violations of securities laws. Coinbase appealed the decision, prompting the latest amicus briefs.

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“The Commission's recent denial of Coinbase's petition to define digital asset securities and regulate digital securities markets violates fundamental principles of fairness, undermines confidence in domestic markets, and continues to harm consumers and creators,” the CCI brief said.

The American Chamber of Commerce adds:

“The SEC's lack of clarity for this important new industry provides a case study in the dangers of refusing to adapt regulation to new circumstances.”

It's unclear when the appeals court might rule on Coinbase's case. The commission has already filed enforcement actions against crypto companies including Binance, Coinbase, Kraken and Ripple. On March 18, a U.S. district court imposed sanctions against the SEC in a “bad faith” lawsuit against the debt fund, raising concerns among many about the commission's behavior in other cases.

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