• The Blockchain Association has filed an amicus brief in support of Coinbase in its legal battle with the U.S. Securities and Exchange Commission (SEC).
• The SEC is suing Coinbase for allegedly operating as an unregistered securities exchange, broker and clearing agency.
• The Blockchain Association says the SEC is asserting authority not granted through the legislative process when it uses its own interpretation of investment contracts and securities.

Blockchain Association Supports Coinbase

The pro-crypto lobbying group Blockchain Association has filed an amicus brief in support of Coinbase in its legal battle with the U.S. Securities and Exchange Commission (SEC). The SEC is suing Coinbase for allegedly operating as an unregistered securities exchange, broker and clearing agency, claiming that at least 13 crypto assets supported by the trading platform are illegally being offered as securities.

Coinbase Argues Digital Assets Not Investment Contracts

Coinbase argues that the digital assets are not investment contracts and therefore should not be deemed as securities. In a filing submitted to the U.S. District Court for the Southern District of New York on August 11th, the Blockchain Association says it supports Coinbase’s argument, adding that Congress did not grant the SEC regulatory authority over the digital assets industry.

SEC Seizing Powers Not Granted Through Legislative Process

The Blockchain Association says the SEC is asserting authority not granted through the legislative process when it uses its own interpretation of investment contracts and securities. “The SEC is now trying to short-circuit the legislative process and seize the power to resolve for itself questions of massive economic and political importance… The SEC’s attempt to seize that expansive authority for itself without clear congressional authorization, and contrary to its own past representations about the scope of its powers, must be rejected.”

Amicus Brief Seeks To Reject Expansion Of Power

In its amicus brief, which seeks to reject any expansion of power from Congress to regulate digital assets markets, The Blockchain Association emphasizes that digital asset markets are a major development which requires significant thought before regulation takes place: “Amici fully agree with those arguments, and submit this brief to emphasize that rapidly expanding market in digital assets is a major development […]”.

Congress Must Grant Regulatory Authority Over Digital Assets Industry

The organization also calls on Congress to grant regulatory authority over digital assets industry rather than allowing regulators such as US Securities Exchange Commission (SEC) decide upon what constitutes an investment contract or security: “…and major questions doctrine forecloses [the] SEC’s effort to arrogate itself massive powers that Congress has never clearly granted it.”