On December 15, the US Securities and Exchange Commission (SEC) rejected a petition from cryptocurrency exchange Coinbase, which had requested the development of new rules for digital asset securities.
In a response letter to Coinbase, the SEC said it “concludes that the requested regulation is not currently warranted and denies the petition.” The decision comes after nearly 18 months of back and forth between Coinbase and the securities regulator.
Coinbase originally filed a petition with the SEC in July 2022, asking the agency to create a “new regulatory framework” for crypto asset securities through its formal rulemaking process. The exchange argued that existing SEC rules are “both incomplete and inappropriate” for digital assets operating on blockchain technology.
‘Crypto-asset securities’
But in its denial letter, the SEC said it “disagrees with the petition’s assertion that the application of existing securities statutes and regulations to cryptocurrency securities… is unworkable.
The rejection of a specialized crypto framework is consistent with SEC Chairman Gary Gensler’s consistent view that most crypto assets fall under long-standing investor protection rules, which he has repeatedly emphasized.
The agency said it currently has no plans to implement the “discretionary rulemaking with substantial scope to create a ‘new regulatory framework’ for crypto-asset securities,” as per the original petition. It cited other ongoing SEC initiatives that could inform whether future rule changes are warranted, writing:
“In addition, the Commission has discretionary authority to determine the timing and priorities of its regulatory agenda, including with respect to discretionary rulemaking as requested in the petition.”
Before the SEC rejected its regulatory petition outright on Thursday, Coinbase had taken legal action against the securities regulator, aiming to compel a response. In April 2023, the exchange filed a lawsuit to force the SEC to officially accept or deny a petition originally filed in July 2022. So far, that petition has been answered.
The post SEC Denies Coinbase Petition for New Crypto Asset Rules first appeared on CryptoSlate.