Amid the ongoing war with the United States Securities and Exchange Commission (SEC), Coinbase has contradicted statements made by its CEO, Brian Armstrong. The exchange has distanced itself from Armstrong’s statements which suggested that the SEC had requested the delisting of all non-Bitcoin crypto assets.
On Monday, in a media interaction, Armstrong stated that the SEC made extensive demands during the investigation. He added that the SEC told the exchange it considered all non-Bitcoin crypto assets to be securities and told Coinbase that it “need[ed] to delist every asset other than Bitcoin.”
In a surprising stance, Coinbase has denied that the SEC made any such demands. Speaking to media, the company called the media coverage an “inaccurate representation of the facts.” Coinbase went on to explain:
Prior to litigation, the SEC did not at any point request that Coinbase delist any specific assets … The interview as published earlier today by the Financial Times omits important context regarding our conversations with the SEC.
Notably, Coinbase also confirmed the statements from an SEC spokesperson quoted in the Financial Times’ original article. Reportedly, the SEC spokesperson had outrightly rejected that their agency asked the cryptocurrency exchange to delist any specific assets.
Following Armstrong’s comments, an SEC spokesperson also denied that the agency had asked Coinbase to delist any specific assets.
However, the exchange officially acknowledged that individual staff could have and share their own view about which activities are appropriate under securities law during an investigation. The company acknowledged that any out-of-context quotations concerning delisting requests could have been published “deliberately or as a result of an oversight.”
While the allegations were framed, the SEC did file charges Coinbase in early June alleging them of violating federal securities laws. While the filing states that the exchange traded in atleast 13 unregistered securities, it does not state that all non-Bitcoin assets are securities, nor does it ask the company to delist the assets described as securities.
Instead, it seeks to have Coinbase pay penalties and comply with injunctions that are yet to be determined. Then, Coinbase sent its opening statement in which it rejected the base of allegations it build its case on. It also claimed that “the SEC has chosen” to pursue enforcement actions.
In its response, the SEC said it would oppose any motion for judgement Coinbase would file and asked the court to reject Coinbase’s arguments that the suit violated the major questions doctrine and other concerns. It also alleged that Coinbase intentionally violated laws.
Then, in the pre-motion hearing, the SEC argued that just because it approves an S-1 filing from a company, does not mean the firm is not operating, or will not operate in “violation of the law.” To this, the presiding judge raised speculations over SEC’s statements and admitted that she was all confused due to the lack of clarity. Recently, the court has also established a timeline for both the parties to follow in the ongoing lawsuit.