Coinbase chief legal officer Paul Grewal believes that the SEC has “misread the law” when it comes to labeling many cryptocurrencies as securities and the “status of crypto will remain strong.”
Grewal said that once a federal judge versed in such matters presides over the case in court, they will come to the same conclusion. He added that the exchange is “very confident” about this and, as such, believes that “crypto is here to stay.”
Grewal made the statement during an appearance on TechCrunch’s Chain Reaction podcast on June 8, where he discussed the SEC lawsuit filed against Coinbase on June 6.
Coinbase was expecting litigation
Grewal said that its business as usual for the exchange despite the lawsuit, and it currently has no plans to delist any of the assets listed in the SEC complaint. However, he added that the exchange would continue to evaluate that position based on new information as it comes in.
Grewal said that Coinbase has been preparing for the lawsuit “for a long time” now as it had been expecting the SEC lawsuit after the watchdog hinted at pursuing litigation earlier in March.
He said that Coinbase’s attempts to glean clarity over regulations and its operations were snubbed repeatedly despite its best efforts to engage with the regulator.
According to Grewal, the exchange privately met with the SEC more than 30 times since the fall of 2022 in an effort to establish common ground and find a path to register with the regulator. However, the SEC ultimately declined to engage with the exchange or provide any guidance.
Grewal said:
“When it came time to get a response from the SEC, or to hear their ideas for how this might work, we received nothing. We were simply thanked for our time and invited to leave.”
Crypto will thrive outside US
Grewal said that countries around the world are starting to establish “strict, firm, but sensible rules” for the crypto industry in their jurisdictions, which points to a bright future for the technology.
He said:
“There is no question that crypto will continue to thrive outside the U.S.”
Meanwhile, it is “striking” that “one part of [the] federal government” that is “insisting” on a completely different approach to regulating the sector, Grewal added.
The SEC has publicly stated that it does not believe new rules and regulations are necessary for the crypto industry as current securities laws already cover them adequately.
However, the crypto industry and many U.S. politicians disagree with the regulator’s stance and believe the sector needs tailor-made rules to account for its differences from traditional finance.
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