New developments continue to occur in the case between the Securities and Exchange Commission and Ripple. Finally, cryptocurrency exchange Coinbase has officially announced that it supports Ripple in the SEC lawsuit.
Major cryptocurrency exchange Coinbase has joined the lawsuit in the capacity of amicus curiae to support Ripple Labs’ defense in the lawsuit filed by the US Securities and Exchange Commission (SEC). In its amicus summary submitted to the court along with its petition, Coinbase argues that the constitution establishes that government agencies must give “fair notice” that the conduct is illegal before taking action. In other words, Coinbase points out that for the SEC to sanction an activity, there must be a way for the public to know that the activity in question is illegal.
If the summary submitted by the cryptocurrency exchange Coinbase along with the petition filed as amicus curiae is approved, the court will consider the accompanying document when making a decision. Both Ripple and the U.S. regulator SEC recently moved to issue a summary judgment in the case, asking the judge to make a decision based on the agreed facts rather than continuing with the hearing.
Coinbase has cited other initiatives from the cryptocurrency industry to add context to the case and support Ripple vis-à-vis the SEC, including a recent motion from the Blockchain Association as the SEC has yet to provide clear regulation for a rapidly growing industry. has joined. Coinbase has repeatedly called for special SEC rules for cryptocurrencies, most recently with a petition to the regulator in July.
The SEC first filed the lawsuit in 2020, alleging that Ripple was selling unregistered securities with its XRP token. In this context, Coinbase’s amicus summary also supports a section in Ripple’s defense, which claims that the SEC has not adequately declared that XRP export and trading constitutes illegal activity.
Coinbase alleges that the SEC is suing XRP token vendors after allowing XRP to trade for years. The cryptocurrency exchange adds that the regulator has made public statements that the token, which has been on the market for a long time, is not considered a security. Coinbase has invited the court to reject the SEC’s request for summary judgment, citing its lack of rulemaking and its alleged lack of fair notice by making confusing statements.
The company also argues that those trying to comply suffer significant losses due to the lack of clarity caused by the SEC. When the SEC voiced its claims against Ripple’s XRP token, many platforms stopped trading XRP, delisting the altcoin, causing the altcoin’s price to plummet. Coinbase delisted XRP and the customers of the cryptocurrency exchange suffered. Additionally, the amicus summary presented noted, “The absence of formal rule-making has led to unexpected enforcement actions like this one that creates market uncertainty and puts US trading platforms such as Coinbase at a deep disadvantage when competing with offshore platforms in jurisdictions where there is no risk of regulatory surprises.” pulling.