Executives at cryptocurrency exchange Coinbase took their company's regulatory woes public on April 27, with chief legal officer Paul Grewal speaking at Consensus 2023 and appearing with chief executive Brian Armstrong in a video posted to YouTube.
The appeal was in response to a notice from Wells received by the firm, a notice from the United States Securities and Exchange Commission (SEC) that it may intend to take enforcement action against him.
"Coinbase's core commitment to regulatory compliance has never wavered," Grewal said in the video, which was directed at the SEC chairman and commissioners.
At around the same time the video surfaced, Grewal was speaking to an audience in Austin at Consensus 2023, where he said:
"We're literally sitting here on the stage asking for regulation, asking for rules, asking for a framework that makes sense for our particular technology so that we can sign up."
In the video, Grewal argued that Coinbase's business hasn't changed in the two years since it was launched. was approved for listing on the Nasdaq stock exchange. At the time, Grewal said that "the SEC's position seemed to be that the SEC lacked the legal authority to regulate businesses like Coinbase."
Grewal attributed the new SEC opinion to FTX. He quoted SEC Chairman Gary Gensler as saying, "I feel like we have enough authority, I really do, in this space." FTX was โtotally differentโ than Coinbase, Grewal added.
Coinbase is already regulated, Grewal said, noting that it has a "BitLicense" from New York state that prohibits it from listing securities.
โWe believe that legislation or regulation is needed if the SEC wants to expand its oversight over our industry,โ Grewal said. The SEC asked Coinbase last summer to develop a proposal for cryptocurrency companies to register if they want to list securities.
The SEC broke off that discussion before responding to Coinbase's proposals and a few weeks before the issuance of Wells' "broad but fundamentally vague" notice. โWe still don't know exactly what it is we do that worries the SEC,โ Grewal said.
Related: Coinbase CEO Calls for Action to Elect Pro-Crypto Legislators Following SEC Wells Notice
Armstrong spoke about his decision to found the company and its early days. He also said:
โWe are committed to working within the regulatory perimeter.โ
The company does not trade securities, he said. He added that the company scrutinizes its offers and rejects "about 90%" of the assets it reviews.
Armstrong also reiterated that Coinbase is prepared to go to court to defend its position. However, โit doesn't have to come to that. We welcome a true dialogue on a viable path for our industry."
coin base received a notice from Wellswhich typically warns of impending SEC enforcement action on March 22.
Magazine: Crypto Regulation: Does SEC Chairman Gary Gensler Have the Final Say?
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