Wyoming Senator Cynthia Lummis filed a report supporting Coinbase’s motion to dismiss the SEC’s complaint, arguing that the SEC lacks authority. The brief contends that the SEC’s assertion that all crypto assets are securities exceeds its authority and contravenes the separation of powers. Lummis urges the court to reject the SEC’s interpretation of its authority and refer to Congress for proper crypto regulation.
Wyoming Senator Cynthia Lummis has pledged her support for the United States cryptocurrency exchange. Coinbase by filing an amicus curiae brief supporting its motion to dismiss the Securities and Exchange Commission (SEC) lawsuit.
“The SEC brings this enforcement action amidst debates in the halls of Congress and around the world about how crypto assets should be regulated. The Constitution empowers Congress, not the SEC, to legislate in an area of such profound economic and political importance,” stated Lummis.
On August 11, Republican Representative Cynthia Lummis filed an amicus curiae brief with the United States District Court for the Southern District of New York.
Coinbase SEC Battle Continues
Amicus curiae is an individual or organization that is not a party to a legal case. However, they are allowed to help a court by offering information, experience, or knowledge that relates to the issues in the case.
Senator Lummis argued that Congress had not given the SEC any authority to regulate or classify crypto assets. “The SEC’s attempt to shoehorn a new asset class into the existing definition of ‘security,’ and thereby add it to the definition enumerated by Congress, exceeds the authority of the SEC, encroaches on the legislative power of the Congress and contravenes the separation of powers. The SEC cannot make laws through the executive branch,” argued Senator Lummis.
Additionally, the SEC’s position that crypto assets themselves are securities improperly broadens the legal definition of “security” beyond what Congress intended. Furthermore, the SEC claims that virtually all crypto assets are securities, as “It exceeds the authority of the SEC, invades Congressional legislation, and violates the separation of powers.”
The brief urges the court to reject the SEC’s novel interpretation of its authority and delegate to Congress the enactment of adequate crypto regulation.
On August 11, several cryptocurrency advocacy groups also filed amicus briefs supporting Coinbase. These included the Blockchain Association, the Crypto Council for Innovation and Progress Chamber, and the Consumer Technology Association.
The SEC sued Coinbase in early June for acting as an unregistered broker and selling unregistered securities. The firm filed a motion to dismiss the complaint on August 4. He argued that the SEC had violated due process and abused its discretion.
In an X (formerly Twitter) thread announcing the move, the Blockchain Association’s lead attorney, Marisa Tashman, echoed Lummis’s comments that “the SEC’s regulatory authority extends only to what Congress has given it.” has granted,” while highlighting the risks of the SEC’s approach to the industry:
Regulation
On August 11, Senator Lummis commented on PayPal’s recently announced stablecoin. He stated that it is “another sign that crypto assets are here to stay as part of the global financial system,” before adding the following:
“Now, Congress needs to secure America’s status as the unquestioned world leader in financial innovation by creating clear regulatory rules.”
Earlier this week, former acting comptroller of the currency Brian P. Brooks urged Congress to speed up the prioritization of stablecoin regulation.
In July, Senators Cynthia Lummis and Kirsten Gillibrand updated their cryptocurrency regulation bill in an effort to speed up the process.
By Audy Castaneda
