JAKARTA - The crypto industry is nothing new for US regulators, but the latest developments in Coinbase and Ripple are reopening unclear crypto regulatory clarity issues. SEC's actions in giving Wells Notice to Coinbase, which has generally preceded surveillance measures, drew criticism from Ripple CTO David Schwartz and disappointment from most crypto communities.
In his Twitter post, Schwartz voiced dissatisfaction with SEC's actions against Coinbase, citing the motive behind the move may have been driven by the inability or desire to protect insiders and early investors.
Schwartz also questioned the true intentions of SEC's latest law enforcement actions and expressed frustration over the agency's Howey test application, which he said was not as simple as some people thought. He also pointed out that even leading securities lawyers at major law firms find it difficult to determine how to apply it to multiple tokens, including Ethereum.
Schwartz's statement reiterated the comments of former blockchain chief on Meta, David Marcus, who also said that Howey test was indeed complicated. In addition, some members of the XRP community also expressed disappointment over the failure of the industry to unite when Ripple was under surveillance, which may undermine the industry.
Instead, Coinbase asked America to accept legal threats in response to SEC actions. Coinbase has shared details of its business with the SEC in more than 30 meetings over the past nine months, seeking to build a path to registration.
However, according to Coinbase CEO Brian Armstrong, the SEC provides practically 0 feedback on what to change or how to sign up. Coinbase also shows that the SEC approved theirgrading S1 when they went public in 2021, knowing the details of their business. Coinbase felt that the SEC had now changed its mind about what was allowed.
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