Paul Grewal, Coinbase’s Chief Legal Officer, was notified of the US Securities and Exchange Commission (SEC) lawsuit against his company less than an hour before he was due to testify on crypto legislation before the House Committee on Agriculture.
Grewal says in a new interview with Bankless that the timing of the SEC’s announcement this week is “curious.”
“The fact is, I heard about this complaint, I don’t know, 45 minutes before I was supposed to walk up to Capitol Hill to testify before the House Agriculture Committee on a bill that was released last Friday. So yes, it’s interesting, curious, pick your word, that the SEC chose just this morning to file the lawsuit.”
The SEC sued Coinbase on Tuesday, alleging that the major US crypto exchange was operating as an unregistered stock exchange, broker and clearing house.
Later that day, Grewal testified about a discussion draft of a digital asset bill being reviewed by the House of Representatives.
Says Coinbase’s Chief Legal Officer,
“The bill is actually quite interesting and quite important. It will provide a real market structure for digital assets, including both digital assets and digital assets, for the very first time. It will provide a path for registration, serious oversight, real protections for consumers and investors – many of the things we’ve been advocating for in the industry for many months, if not many years.
Coinbase filed a motion in court in April to compel the SEC to respond to a previous petition from the company seeking guidance for the digital asset industry.
This week, the U.S. Court of Appeals for the Third Circuit issued an injunction requiring the regulator to respond to the petition within seven days. The order cited the SEC’s recently announced lawsuit against the exchange.
Explains Grewal,
“We continue to believe that the SEC could not proceed with lawsuits against our industry, such as the one brought against us today, if the SEC had not already decided to reject our rule-making petition.
We continue to believe that traffic rules, be it law or regulation or both, should come before enforcement action. That’s why we petitioned the SEC for regulation almost a year ago.
If the SEC’s answer to our regulatory petition is “no,” then they’re legally obligated to tell us, because we have the legal right to challenge that “no” in court. And there are serious questions to ask.”
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