Pushing SEC Out: Crypto Industry And New Supreme Court Doctrine

The crypto space is clinging to the new Supreme Court doctrine of pushing the SEC out. Check out the latest reports about this below.

The online publication Blockworks notes the fact that the crypto companies are clinging to a new US Supreme Court doctrine with hopes it will set the legal precedent for the SEC to step aside, but federal regulators are skeptical.

As the online publication mentioned above notes, back in a June 2022 decision, the Supreme Court sided with states challenging the Environmental Protection Agency’s right to regulate greenhouse gas emissions.

Justices opted to adopt a formal doctrine, the major questions doctrine, which seeks to limit federal agencies’ power.

In the doctrine, the Supreme Court says that Congress does not delegate deciding the fate of “extraordinary” cases which deal with matters of crucial political and economic impact to federal agencies, such as the EPA or SEC.

The notes also highlight the fact that Coinbase cites the doctrine in its April 2023 response to the SEC’s Wells notice and incoming enforcement action.

It’s also important that we noye the fact that the SEC has no grounds to unilaterally make decisions about crypto, particularly when it comes to token classification, Coinbase’s legal team argued.

“An agency declaration that the majority of all digital assets, or more shockingly that all digital assets other than Bitcoin, are unregistered ‘securities’ that cannot legally be traded constitutes an obvious assertion of regulatory authority over a ‘significant portion of the American economy,’” Coinbase wrote in its preemptive Wells defense.

“Everything that we do as an agency is based upon the authorities Congress has given us,” SEC Chair Gary Gensler stated recently during a keynote address at the 2023 Financial Markets Conference Monday.

Gensler continued and said: “Whether it’s the Fifth Circuit, the Supreme Court or any other circuit court opinion, we look at those closely…that we stay within our authorities in the law.”