Key Takeaways
- Coinbase states it “believes that parties like Ripple must be permitted to pursue fair notice defenses in matters where they are facing surprise enforcement actions like this one.”
- Investor Choice Advocates Network, Blockchain Association, SpendTheBits were also granted permission to file amicus briefs supporting Ripple in October.
Leading crypto exchange Coinbase has petitioned Judge Analisa N. Torres for permission to file an amicus brief supporting Ripple in the ongoing legal battle against U.S. Securities and Exchange Commission (SEC).
An amicus brief or friend of the court refers to an adviser to the court on some matter of law who is not a party to the case. The Ripple vs. SEC duel revolves around alleged violations of Ripple selling its XRP token as an unregistered security.
In its petition, the exchange states it “believes that parties like Ripple must be permitted to pursue fair notice defenses in matters where they are facing surprise enforcement actions like this one.” Coinbase further, in its filing, pointed out that SEC has not engaged in any rulemaking that would “provide the regulatory clarity” companies want.
Making the announcement, Paul Grewal, Coinbase’s chief legal officer, took to Twitter to state that the exchange had asked the presiding judge for permission to file an amicus brief, saying the case was a “textbook definition of just how critical fair notice is”. “By suing sellers of XRP tokens after making public statements signaling that those transactions were lawful, the SEC has lost sight of this bedrock principle, “he added.
“The existing SEC registration requirements for national securities exchanges are currently unsuitable to the way digital asset platforms operate,” said the exchange in its filing, adding that “the end result is extraordinarily costly to U.S. innovation in this new industry.”
If the amicus brief gets approved, the crypto exchange will join the ranks of the non-profit organization Investor Choice Advocates Network, Blockchain Association, and crypto payments app SpendTheBits which were granted permission to file amicus briefs in October.
The SEC vs Ripple duel started in late 2020 when SEC announced they were suing Ripple, former CEO Christian Larsen, and current CEO Brad Garlinghouse for allegedly raising $1.3 billion through unregistered securities sales through XRP.
The U.S. watchdog alleged that Ripple executives held an initial public offering (IPO) of XRP, which was unregistered security at the time of raising capital. Currently, over 75,000 XRP investors have joined the cause, filing amicus briefs backing Ripple. Almost two years later, many legal experts speculate that SEC would soon face a “bruising defeat” in the case.
