May 4, 2023 - Economy

The SEC has 10 days to respond to Coinbase

Illustration of the SEC logo eagle dropping a green cube.

Illustration: Lindsey Bailey/Axios

The U.S.'s largest crypto exchange is poised to get an answer from a top financial regulator on whether crypto-specific regulation is coming, or not.

Driving the news: The Third Circuit Court of Appeals said the SEC had to file a response to Coinbase's writ of mandamus within 10 days of its order filed Wednesday evening.

Catch up fast: Coinbase is seeking to force the SEC to use its formal rulemaking process to provide greater guidance to companies operating in the sector, using the legal system to move the issue forward.

  • If the SEC responds "yes" — highly unlikely given chairman Gary Gensler's stance that crypto adhere to existing securities laws — Coinbase gets what it is seeking.
  • If the SEC responds "no" — the exchange would be able to challenge that decision in court.

Between the lines: Coinbase can't challenge the SEC's decision without an SEC decision.

What we're watching: How the SEC responds. (It declined to comment for Axios.)

  • Any meaningful updates from CEO Brian Armstrong during Coinbase's earnings call ,scheduled for after the market's close tonight.
Go deeper