The U.S. Securities and Exchange Commission (SEC) says it needs more time to decide whether to respond to Coinbase’s request for regulatory clarity regarding the crypto industry.
Coinbase filed a motion in court in April to compel the SEC to respond to a July petition from the company seeking guidance for the digital asset industry.
Last week, the SEC sued Coinbase, alleging the largest U.S. crypto exchange operated as an unregistered stock exchange, broker, and clearing house.
That same day, the U.S. Court of Appeals for the Third Circuit issued an injunction requiring the regulator to respond to Coinbase’s motion within seven days, citing the recently announced lawsuit against the exchange.
The SEC filed a response Monday, arguing that there is “no merit” to Coinbase’s attempt to force them to respond quickly to the regulatory petition.
“The Commission has not yet decided what action to take on that petition, in whole or in part – which is perfectly reasonable given the breadth of the regulatory petition and the fact that it was filed just months ago and was more recently supplemented by Coinbase.”
The SEC maintains that Coinbase’s continued consideration of the regulatory petition does not undermine existing legislation and its recent efforts to enforce it. The regulator also says the lawsuit against Coinbase does not mean it has decided to reject the exchange’s request for regulatory clarity.
“There is no inconsistency between the Commission’s allegations that Coinbase violated longstanding regulatory standards and the Commission’s consideration of whether the current regime should be expanded or changed.”
The SEC states it should not “commit” to a deadline to respond to Coinbase’s petition, but does note that its staff “anticipates being able to make a recommendation to the Commission within the next 120 days regarding that petition.”
Paul Grewal, Chief Legal Officer of Coinbase, blasted the regulator’s response on Twitter, claiming SEC lawyers are “repeating the misconception” that the Commission has made no new decisions on crypto regulation.
“They refuse to commit to any deadline, despite the express order of the Court; instead, they ‘anticipate’ a ‘recommendation’ in 120 days; and more importantly, they ignore the clear statements from the chairman confirming that they have no intention of issuing new rules, and instead confuse the evidence of a decision those statements provide with an argument that the statements themselves are a decision .
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