Big Defeat for the SEC’s Gensler: Coinbase Secures Partial Win
In a major legal development, the U.S. Securities and Exchange Commission (SEC), led by Gary Gensler, has suffered a setback in its ongoing battle with Coinbase. This marks another loss for the SEC following a series of recent failures in cryptocurrency-related cases.
Court condemns SEC’s actions
Coinbase has won a writ of mandamus petition from the Third Circuit Court of Appeals, which chastised the SEC for rejecting its request for clearer rules on the regulation of digital assets. The court found the SEC’s order to be ill-founded and arbitrary, calling it “conclusive” and “capricious.” The ruling forces the SEC to reconsider its position and provide a more thorough explanation for its refusal to develop specific rules governing cryptocurrency regulation.
Coinbase Chief Legal Officer Paul Grewal celebrated the victory on Twitter, saying: “We just won a writ of mandamus petition in the Third Circuit condemning the SEC’s order denying our rulemaking petition.” He said that the court’s decision Highlighting the SEC’s failure to provide adequate justification for its actions.
“We are further grateful to Justice Bibas for his concurrence, in which he spoke forcefully about the looming constitutional issue of ‘ex post facto enforcement without declaring ex ante rules or guidance.’ It is an impressive piece of work,” he wrote.
SEC’s loss pattern
The ruling adds to a growing list of defeats for the U.S. Securities and Exchange Commission (SEC) under Gensler. The agency has been criticized for its arbitrary decision-making in multiple cases, including the rejection of the Grayscale Bitcoin ETF, and the SEC has also been criticized for a lack of justification. Legal experts have long criticized the SEC’s approach to cryptocurrency regulation, accusing the agency of overreach and bias.
