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Coinbase Legal Head Paul Grewal Says The SEC ‘Misread The Law’

Coinbase Chief Legal Officer Paul Grewal believes that the SEC has “misread the law” when it comes to labeling many cryptocurrencies as securities and that “the case for crypto will remain strong.”

Grewal said that once a federal judge presides over such cases in court, they will reach the same conclusion. He added that the exchange is “very confident” about this and as such, he believes “crypto is here to stay.”

Grewal made the statement during a Presence on TechCrunch’s Chain Reaction podcast on June 8, where he discussed the SEC lawsuit filed against Coinbase on June 6.

Coinbase Was Expecting Litigation

Grewal said that it is business as usual for the exchange despite the lawsuit, and that it currently has no plans to liquidate any of the assets listed in the SEC complaint. However, he added that the exchange will continue to evaluate that position based on new information as it comes in.

Grewal said Coinbase has been preparing for the lawsuit for “a long time” now, as the SEC expected a lawsuit after the watchdog indicated litigation earlier in March.

He said that despite his best efforts to engage with the regulator, efforts to seek clarity on Coinbase’s regulations and its operations were repeatedly turned down.

According to Grewal, the exchange privately met with the SEC more than 30 times since fall 2022 in an effort to establish common ground and find a way to register with the regulator. However, the SEC ultimately declined to engage with the exchange or provide any guidance.

Grewal said:

“When it came time to get a response from the SEC, or to hear their ideas about how this might work, we received nothing. We were only thanked for our time and invited to visit .

Crypto Will Thrive Outside the US

Grewal said that countries around the world are starting to establish “strict, firm, but sensible regulations” for the crypto industry in their jurisdictions, which points to a bright future for the technology.

They said:

“There is no question that crypto will continue to flourish outside the US”

Meanwhile, it is “striking” that there is “a part of the (federal) government” that is “pushing” on a completely different approach to regulating the sector, Grewal said.

The SEC has publicly stated that it does not believe new rules and regulations are necessary for the crypto industry as the current securities laws already cover them adequately.

However, the crypto industry and many US politicians disagree with the regulator’s stance and believe the sector needs tailor-made regulations taking into account its differences from traditional finance.

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