Crypto.com has taken a significant legal step against the U.S. Securities and Exchange Commission (SEC) following the regulatory body’s receipt of a Wells notice.
It claimed that the securities regulator had exceeded the limits of its statutory authority by trying to expand its scope and adopt rules branding virtually all crypto assets as securities, with the notable exceptions of Bitcoin and Ethereum.
In its complaint, Crypto.com stated that the SEC’s acts were illegal and threatened the future of the US crypto industry. Specifically, Crypto.com alleges an unauthorized and excessive enforcement campaign targeting lawful businesses in the crypto space without due regulatory processes.
Thus, one of the central arguments of the legal complaint is that the SEC has failed to follow the correct rulemaking procedures as mandated through the Administrative Procedure Act.
As Crypto.com mentioned, the agency has arbitrarily classified crypto assets as securities without notice and a comment period. On the contrary, treatment has been extended to BTC and ETH, stating that these assets are not securities under the agencies’ rules.
Crypto.com seeks clarity on derivative product regulation
Besides this, affiliates Crypto.com and Crypto.com Derivatives North America have filed a petition to both the SEC and CFTC. The petition seeks clarity on the regulatory treatment of certain cryptocurrency derivative products and requests a concert interpretation from the agencies.
The exchange also stays in step with the laws in the U.S. by holding a slew of state operating licenses. Despite the lawsuit raising a lot of legal questions, security and compliance stand out as two of the core tenets of its operations, with both equating Crypto.com to one of the leading global crypto companies.
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