Sec On Public Approval Of Coinbase

7/15/2023 2:00:27 PM

(MENAFN- CoinXposure) The SEC has maintained in court that clearing a firm's S-1 application to go public does not constitute a“blessing” or a confirmation of regulatory compliance.

According to July 13 court documents from the SEC vs. Coinbase pre-motion hearing, the SEC did not approve Coinbase's company structure when it allowed it to go public in April 2021.

SEC trial counsel Peter Mancuso stated,“Your Honor, simply because the SEC allows a company to go public does not mean that the SEC is blessing the underlying business or the underlying business structure or saying that the underlying business structure is not in violation of the law.”

on crypto twitter, several people, including Gemini co-founder Cameron Winklevoss, pointed out the ramifications of such statements, questioning why the SEC would allow a presumably noncompliant corporation to go public given its aim of protecting U.S. customers.

Before listing on a national stock market, U.S. companies must file an S-1 with the SEC. Companies must describe their business structure and how they will use IPO revenues in their filing.

After Mancuso's remarks, U.S. District Judge Katherine Polk Failia said,“Let's just pause so I can just sort of get rid of the skepticism I currently have as I hear that answer,” before asking more questions.

“I am not saying that the commission should be omniscient at the time it's evaluating a registration statement and that it should know all things,” she said.

See also attorney faces backlash for relying on chatgpt 2 months ago

In response, Mancuso reiterated the SEC's claim that S-1 filings are more about approving company disclosures than a business structure. Failia asked Mancuso if the SEC could not have told Coinbase,“Hey, you guys need to register as a securities exchange.”

“The SEC could do that, right?” she asked.“I can't speak to that,” Mancuso said. The SEC initially charged Coinbase for 2019 unregistered securities offers .

Coinbase wants the case dismissed early because the SEC charged the firm despite its business structure and planned actions being“exhaustively described” to the agency before the coinbase public offering .

MENAFN15072023007320015750ID1106607292

Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.