Coinbase Slams ‘Evasive Response’ from SEC to Court Order

The Securities and Exchange Commission’s (SEC) response to a court order has been severely criticized by crypto-exchange giant Coinbase, in a rendition filed with the United States District Court for the Northern District of California late last week. Coinbase called out the SEC for its “evasive response” and demanded further clarification over the matter. This latest development has sparked significant questions over the ongoing debate between the SEC and the cryptocurrency sector.

1. Coinbase Criticizes SEC for Refusing to Release Docs

Coinbase, one of the leading US-based cryptocurrency exchanges, has issued a formal statement criticizing the US SEC for its failure to respond to requests for documents needed to complete their registration as a national securities exchange.

The firm was quoted as saying: “We were disappointed to receive a letter from the SEC’s Division of Trading and Markets declining our application for registration. We remain incredibly frustrated that the SEC has not provided clear guidance on cryptocurrencies and other digital assets, despite our repeated requests. We hope that the SEC will soon provide the much-needed clarity and define a pathway for cryptocurrency-related businesses to engage effectively and productively with the agency.”

Coinbase mentioned that its attempts to reach out to the SEC for guidance on digital assets have been a “frustrating experience” as the repeated requests for documents have not been provided by the SEC. Coinbase also stated that its efforts have been met by “conflicting signals” from the agency.

• Coinbase issued a formal statement criticizing the US SEC for its failure to respond to requests for documents
• Coinbase mentioned that its attempts to reach out to the SEC for guidance on digital assets have been a “frustrating experience”
• Coinbase stated that its efforts have been met by “conflicting signals” from the agency

2. Court Requires SEC to Produce Documents to Coinbase

In a court battle between Coinbase Global Inc. and the United States Securities and Exchange Commission (SEC) over a data request, the SEC has been ordered by the court to produce all documents requested by Coinbase. Judge Richard Seeborg had dismissed the Commission’s claims that certain documents are privileged. In an earlier filing, Coinbase had argued that the SEC had dodged its demands for certain internal communications, preventing Coinbase from mounting an effective defense.

The Court found that Ransomware Attack records, emails discussing the attack, Audit Commission reports, SEC’s internal investigation records, and SEC’s post-attack response report must be released. The Court acknowledged that the SEC had already released some of this information, but that some of the documents had been withheld on the ground that they were privileged. The Court rejected the SEC’s argument noting that it was unable to cite any case law that document production on the basis of privilege was necessary.

The speed at which the SEC responds—or fails to respond—to the court order will ultimately shape the direction of the legal battle. Until then, Coinbase’s demands remain unanswered.