- Coinbase’s Chief Legal Officer raises concerns over SEC’s handling of cryptocurrency regulations.
- Recent SEC statement sparks speculation on undisclosed decision about crypto regulations.
- Chairman Gensler’s shift to AI and lack of clarity on crypto regulations prompt questions from Coinbase’s legal officer.
Paul Grewal, the chief legal officer of Coinbase (NASDAQ:COIN), recently took to Twitter to voice his concerns about the seemingly deliberate withholding of information by the SEC regarding their stance on cryptocurrency regulations.
6/13/23, Ltr to the 3d Circuit: "The Commission has not yet decided what action to take on that petition."Today: “We can get to crypto later.”Is there any serious question that a decision was made to deny sensible rules but deliberately withheld from the public?…— paulgrewal.eth (@iampaulgrewal) August 3, 2023
In his tweet, Grewal refers to a letter sent to the Third Circuit on June 13, 2023, in which the Commission stated they had not yet decided on the action to take regarding a certain petition. (The Third Circuit Court is known as the United States Court of Appeals for the Third Circuit. It is one of the thirteen federal appellate courts with the authority to hear appeals from district courts within its jurisdiction.) However, a recent statement from the Commission, “We can get to crypto later,” raised eyebrows and sparked questions about whether a decision has already been made but kept from the public.
The tweet from Grewal was in response to a Bloomberg article featuring Gary Gensler, the head of the US Securities and Exchange Commission (SEC). Gensler expressed his desire to shift the conversation away from cryptocurrencies. He believes the crypto realm is riddled with scams and fraud, and points towards artificial intelligence (AI), which he deems “the most transformative technology of this generation.”
Gensler’s focus on AI over crypto is not without reason. He argues that AI, unlike digital coins and non-fungible tokens, truly deserves the hype and attention it’s receiving. He believes that the mass automation brought about by AI has the potential to fundamentally change finance, with implications for trillions of dollars in assets that trade on markets overseen by the SEC.
However, Gensler also warns of the risks associated with unchecked AI. While AI can help firms better serve their clients, it can also obscure accountability when things go wrong. This shift in focus from crypto to AI and the apparent delay in decision-making on crypto regulations, are what prompted Grewal’s tweet. Additionally, Grewal questioned whether a decision on crypto has already been made but has been deliberately withheld from the public.
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