Coinbase CEO Brian Armstrong has responded publicly to the United States Securities and Exchange Commission (SEC) lawsuit against his company, stating in a tweet that the team is “confident in our facts and the law” and that it welcomes the chance “to finally get some clarity around crypto rules” in court.
Regarding the SEC complaint against us today, we’re proud to represent the industry in court to finally get some clarity around crypto rules.
Remember:1. The SEC reviewed our business and allowed us to become a public company in 2021.2. There is no path to “come in and…
— Brian Armstrong ️ (@brian_armstrong) June 6, 2023
The SEC filed suit against crypto exchange Coinbase on June 6, alleging that the company has been operating a securities exchange, broker-dealership and clearing house without registering with the commission. In its filing, it argued that 13 different cryptocurrencies sold by Coinbase fit the definition of securities, including Cardano (ADA), Solana (SOL), Polygon (MATIC), Filecoin (FIL) and others.
In his Twitter response, Armstrong claimed that the lawsuit against Coinbase is “very different from others out there,” as it is “exclusively focused on what is or is not a security.” This makes the team “confident in our facts and the law.” He claimed that the U.S. government can’t even agree with itself as to which cryptocurrencies are securities, as “the SEC and CFTC [Commodity Futures Trading Commission] have made conflicting statements.”
Armstrong expressed hope that court proceedings will allow crypto exchanges to “finally” get clarity on how to comply with securities laws. He also praised recent attempts by Congress to pass crypto legislation, stating that “this is why the US congress is introducing new legislation to fix the situation.”
Related: Coinbase targeted by state security regulators concurrent to SEC lawsuit
The response from Armstrong is the latest in a series of legal filings and public statements between the exchange and the SEC since March.
Coinbase received a Wells notice from the SEC on March 22 stating that the regulator may pursue enforcement actions. In response, the exchange issued a statement from its legal team on April 19 claiming that the SEC’s possible enforcement was not “supported by law or within the bounds of the Commission’s authority.”
A Wells notice does not begin legal proceedings. It only serves to notify a firm of a potential lawsuit.
On April 25, Coinbase’s legal team went on the offensive by preemptively filing suit against the securities regulator. In the lawsuit, it alleged that the SEC had failed to provide clear rules for crypto exchanges in a timely manner, including rules that distinguish between cryptocurrencies that are or are not securities. The SEC responded by arguing for dismissal on May 5, and Coinbase filed a mandamus reply in support of its suit against the SEC on May 23.
Because Coinbase filed its suit against the SEC on April 25 and the SEC filed suit against Coinbase on June 6, both organizations are now embroiled in two separate legal proceedings against each other.