US Court Orders SEC to Justify Denial of Coinbase’s Regulation Request

The US Court of Appeals for the Third Circuit has asked the US SEC to justify its decision to deny Coinbase's request for specific crypto regulations, labeling the reasons given as insufficient.

Coinbase Legal Challenge Against SEC

The legal dispute began over alleged violations of securities laws by Coinbase.
Coinbase has argued that the SEC lacks adequate legal oversight in this case.
The exchange seeks clarity on how federal securities laws relate to crypto assets.
The SEC's rejection of Coinbase's petition prompted court involvement.

Court's Demand for SEC Clarity

The judge issued rulings on January 13, requiring the SEC to clarify its rejection of Coinbase's petition.
The SEC's two-page letter was deemed vague and "arbitrary and capricious" by the court.
No new rules have been mandated yet, leaving regulatory clarity uncertain for the crypto industry.
Judge Thomas L. Ambro emphasized the need for the SEC to provide a more coherent explanation.
The court expressed concern that existing regulations do not align with advancements in crypto technology.