Big Defeat for SEC’s Gensler: Coinbase Confirms Partial Win
In a major legal development, the US Securities and Exchange Commission (SEC) led by Gary Gensler has faced setbacks in its ongoing battle with Coinbase. This marks another loss for the SEC following a series of recent losses in crypto-related cases.
Court reprimands SEC actions.
Coinbase won a petition for a writ of mandamus at the Third Circuit Court of Appeals against the SEC for denying its request for clear rules on the regulation of digital assets. The court found the SEC's order unreasonable and arbitrary, saying it was “summary” and “prejudicial.” This will force the SEC to reexamine its position and provide a more in-depth explanation of its refusal to create specific regulations governing crypto.
Paul Grewal, chief legal officer at Coinbase, tweeted to celebrate the win: “We have won our petition for a writ of mandamus in the Third Circuit, challenging the SEC's order denying our rulemaking petition. The court's decision highlights the SEC's lack of justification for its actions, he said.
“We appreciate Judge Bibas's concurrence” in future constitutional cases “without prior notice of a post-enforcement rule or directive.” It's an amazing job,” he wrote.
Loss pattern for SEC
This decision adds to a growing list of losses at the SEC under Gensler's leadership. The agency has been called out for making arbitrary decisions in several cases, including the rejection of the Greyscale Bitcoin ETF, while the SEC has similarly been criticized for not providing sufficient grounds. Legal experts have long criticized the SEC's approach to crypto regulation, accusing the agency of overreach and bias.
