- The groups filing these briefs before the SEC against Coinbase are NASAA, NFI, and some legal scholars.
- The instructions emphasized that regulators such as the SEC can implement existing laws in emerging financial situations.
In an interesting turn of events, three amicus briefs were recently filed supporting the U.S. Securities and Exchange Commission (SEC) in its ongoing lawsuit against Coinbase [COIN].
The securities regulator sued the cryptocurrency exchange in June, saying it violated securities laws by operating as an unregistered broker-dealer. Coinbase has responded by disputing all allegations. It asked the court to dismiss the SEC’s lawsuit, claiming the regulator has no jurisdiction over the crypto industry.
The three groups that filed the latest amicus curiae are the North American Securities Administrators Association (NASAA), the New Finance Institute (NFI), and the Administrative Law Scholars.
What do these amicus briefs claim?
The NASAA is an association of securities regulators in the US, Canada and Mexico. Former SEC officials, including former Chairman Mary Jo White and Commissioner Robert Jackson Jr., have done so archived the assignment on behalf of NASSA. It argued that Congress has defined “security” broadly enough to regulate investments in any form.
Under securities laws, crypto assets mentioned in the SEC’s enforcement action against Coinbase are considered investment contracts. The strike program constituted an investment contract.
It is not only the public position of the SEC, but also that of other government bond regulators regarding crypto assets, the letter argued.
The NFI is a financing-related institution of general interest archived an amicus brief. It asserted that neither “investment” nor “contract” are terms of an “investment contract.” It also argued that the SEC has the authority to regulate crypto assets.
The letter asked the court to deny Coinbase’s request for judgment on the pleadings.
Todd Phillips, an assistant professor of law at the J. Mack Robinson College of Business at Georgia State University, and Beau Baumann, a doctoral candidate at Yale Law School, archived the third amicus brief on behalf of the administrative law scholars.
The third assignment focused on the ‘big questions doctrine’. It means that Congress should clearly specify whether it wants an authority to have power over important economic or political matters, rather than implying such authority in law.
The letter highlighted recent Supreme Court rulings and emphasized that any attempt by Coinbase to redefine or limit the interpretation of the doctrine could overstep its bounds.
The letter emphasized that regulators such as the SEC can implement existing laws in emerging financial situations. In fact, delays in obtaining explicit orders from Congress hinder regulatory effectiveness.
