Crypto.com Sues SEC Over Regulatory Disputes

Crypto.com believes this action is necessary to protect the future of the cryptocurrency industry in the United States.

They are joining other companies in standing up to what they see as a federal agency overstepping its bounds.

Crypto.com Takes On the SEC

The exchange is responding to a Wells notice they received from the SEC. This indicates that the agency is trying to impose rules that they believe are unfair and not legally justified.

Crypto.com argues that the SEC is trying to extend its authority beyond what the law allows. They claim that the SEC has created a confusing rule stating that most trades involving cryptocurrencies are considered securities transactions. However, similar transactions with popular cryptocurrencies like Bitcoin (BTC) and Ether (ETH) are not treated the same way. This inconsistency, according to Crypto.com, is unfair and doesn’t follow the proper legal processes.

The SEC didn’t allow the public to comment on this new rule, which is something that should have happened under federal law. Crypto.com feels that the SEC’s actions are not only arbitrary but also go against the law.

In their lawsuit, Crypto.com wants to put a stop to what they see as the SEC’s illegal actions. They believe these actions threaten the entire crypto industry and make it hard for legitimate businesses to operate. They have made detailed information about their lawsuit available to the public, highlighting their concerns about the SEC’s approach to regulation.

Additionally, Crypto.com’s North American division has reached out to both the SEC and the Commodity Futures Trading Commission (CFTC) with a petition. They want to clarify that certain cryptocurrency products should only be regulated by the CFTC. By using this petition under the Dodd-Frank Act, they hope to bring more clarity to the rules governing the industry.

This joint rulemaking allows anyone to ask the SEC and CFTC whether a product is a “swap” or a “security-based swap.” If the agencies deny this request, they must provide a written explanation.

Disclaimer

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