Cryptocurrency exchange Coinbase submitted a report to the appeals court in which it criticized the US Securities and Exchange Commission's policies regarding digital assets.
According to the company, the regulator intends to create difficulties for market representatives, after which it files lawsuits against them.
Representatives of Coinbase claim that crypto firms have become victims of the so-called “catch 22”. This term implies the creation of a legal conflict in which an attempt to comply with a certain rule itself means its violation.
The SEC specifically supports such regulatory conditions for companies in the digital asset industry, the exchange’s lawyers believe. At the same time, Coinbase points out the regulator’s reluctance to sit down at the negotiating table and develop clear rules for doing business in this segment.
“This pattern of behavior is a deliberate attempt to disrupt an industry by demanding the impossible and targeting companies that cannot achieve it,” the firm said in its report.
In a 36-page document, Coinbase's defense provides examples of the SEC's biased attitude towards crypto participants. The report also mentions the position of some Commission members who believe that the regulator is hindering the development of the digital asset industry.
For example, SEC representative Hester Pierce previously spoke about the creation of a cross-border sandbox for blockchain companies from the US and UK. As part of this program, firms can experiment with tokenized securities, the commission member noted.
“One of the problems we had was that people were trying to come to the SEC to get help. However, when you arrive, nothing happens. This program will shake up the regulator a little,” Pierce said.
It's worth noting that in its report, Coinbase also mentions the SEC's attempt to soften its approach to the crypto asset space. The agency claims that the new approach may only create problems for a small percentage of the market, the report says.
The SEC filed a lawsuit against the exchange in June 2023, accusing the company of operating without a license. After some time, Coinbase demanded that the court reject the regulator’s claims, but was refused.
