Leading American cryptocurrency exchange Coinbase is seeking permission to file an amicus brief, also known as a “friend of the court,” in support of Ripple Labs’ active court case with the United States Securities and Exchange Commission (SEC).
According to a court documents filed on October 31, the exchange requested permission from Judge Analisa Torres of the United States District Court for the Southern District of New York Judge to submit a proposal to the Commission.
SEC v. Ripple: Genesis
Note that in December 2020, the SEC is official sued Ripple and its executives, Chris Larsen and CEO Brad Garlinghouse, for allegedly conducting unregistered securities sales by selling XRP tokens to US investors without authorization from the Commission.
The agency reported that Ripple raised $1.3 billion in initial coin offerings (ICOs) through sales of XRP, which regulators now label as securities.
After the SEC action, crypto exchanges in the US started delisting tokens on the platform, causing the token’s market value to drop by $15 billion.
The mass delisting event affected most Coinbase users as the exchange also suspended trading of the asset pending a court decision.
Coinbase Shows Support for Ripple
Coinbase has now come out in support of the fintech company, noting that Ripple Labs should be allowed to pursue a “fair notice defense” where it faces surprise enforcement actions like the case with the SEC.
The exchange said the securities watchdog failed to provide fair notice before taking enforcement action against the company.
“Since there are no SEC rules for the crypto industry, the question of whether the SEC has given fair notice before taking enforcement action against the sale of one of the thousands of unique digital assets will often be factual, which makes it particularly unsuitable for adjudication on summary judgment,” the document said court.
Coinbase also claimed that the SEC has been inconsistent with the way it enforces the crypto industry, creating “uncertainty” for companies in the space.
“Additionally, the existing SEC registration requirements for national securities exchanges are currently incompatible with the way digital asset platforms operate.”
Meanwhile, Coinbase is one of the companies supporting Ripple in its ongoing case with the SEC because the outcome will set a precedent in the crypto industry.
On October 28, the American-based crypto advocacy group Blockchain Association submitted for a “friend of the court” proposal to stand with Ripple.
This article first appeared on CryptoPotato
Here’s How To Stay Crypto Updated With The CRU News Desk!
For the best exchange, check out our top exchange guide.
Sign up for our bi-weekly newsletter for exclusive news and analysis.
Follow the CRU News Desk on Twitter for the latest articles and exclusive Twitter threads.
Learn about Bitcoin, Ethereum, and more at CryptosRus Academy.