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Coinbase battles SEC over alleged securities violations, filing a lawsuit and raising questions about industry regulations.
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Former SEC lawyer Marc Fagel suggests Ripple lawsuit outcome may impact SEC's enforcement action against Coinbase.
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Ripple case's final ruling expected soon, with potential ripple effects on cryptocurrency regulations and SEC's role.
Coinbase, the cryptocurrency giant, recently made headlines for its ongoing legal feud with the US Securities and Exchange Commission (SEC). In March, Coinbase received a Wells Notice, accusing it of violating Federal Security Laws. However, Coinbase fired back, asserting that it does not deal in securities.
Taking the fight a step further, Coinbase filed a lawsuit against the SEC in April, seeking a response to its earlier petition questioning the applicability of securities rules to the crypto industry. Surprisingly, the SEC remained tight-lipped about the petition, leaving many wondering about the reasons behind the delayed enforcement action.
Let’s delve into the insights shared by former SEC lawyer Marc Fagel.
Why The Delay In SEC’s Legal Action Against Coinbase?
Marc Fagel, the former SEC lawyer, took to Twitter to reveal the possible reasons why the US Securities and Exchange Commission (SEC) has not taken any legal action against Coinbase.
Famous cryptocurrency enthusiast Mr. Huber (@Leerzeit) brought out the fact that the commission has not sued Coinbase despite serving the company with a Wells Notice two months ago.
Fagel responded to the tweet by saying it is not unusual that the SEC has not yet sued Coinbase despite serving the firm with a Wells Notice two months ago.
According to the former SEC lawyer, the Wells submission was made approximately on April 19. He emphasized that the SEC might choose to wait for a ruling in the Ripple lawsuit before taking any enforcement action against Coinbase.
XRP Enthusiasts React
Fagel’s opinion has sparked responses from XRP enthusiasts, including Australian lawyer Bill Morgan. In a tweet yesterday, Morgan inquired whether the SEC would stop its enforcement action against crypto exchanges if it loses the Ripple case. As of now, the former SEC lawyer has not responded to Attorney Morgan’s question.
That is interesting to contemplate. If the SEC is waiting for the Ripple decision and is unsuccessful would you expect the enforcement actions against crypto exchanges to be paused or not pursued at all? https://t.co/OVFnAiOStk
— bill morgan (@Belisarius2020) May 28, 2023
Ripple Vs. SEC: Is The End Near?
The Ripple Vs SEC lawsuit has been going on for over two years now and has finally reached its final stage. The summary ruling could be made any time now. While there is no official date for a final verdict, Ripple CEO Brad Garlinghouse expects the judge to issue a ruling in the coming weeks.
According to legal experts, the resolution of the lawsuit will have a significant impact on the rules governing cryptocurrencies in the United States. If the SEC prevails, it might take over as the industry’s main regulator.