Coinbase slams SEC stance on former ex-manager's insider trading case

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The Coinbase administration submitted to the court a private opinion on the case of the ex-manager of the exchange, denying the presence of corpus delicti and demanding a review of the decision.

A motion to dismiss the criminal case was received by the Seattle District Court.Coinbase is asking for a halt to the investigation of Nikhil Wahi and Ishan Wahi, accused by the U.S. Securities and Exchange Commission (SEC) of insider trading in securities.

Coinbase management denies that any of the assets former Coinbase manager Ishan Wahi had access to were securities. In principle, the crypto exchange does not quote securities.

Marketplace General Counsel PaulPaul Grewal reminded the court that the company had repeatedly attempted to register with the SEC in order to be able to offer clients securities denominated in digital assets. However, all efforts were in vain.

Returning to the court materialsinvestigations against the Wahi brothers, Paul Grewal said that the SEC would have had the legal right to demand criminal prosecution of exchange employees if it had previously been able to provide Coinbase with comprehensive rules and recommendations. Moreover, the SEC was not even able to defend its position in court.

"The Department of Justice admitted this whencharged our former employee and his co-conspirators with wire fraud, but not with securities fraud because the assets involved were not such," he wrote.
Grewal on Twitter.

In its filing with the court, Coinbase said the SECdeliberately deviates from fulfilling its primary role in order to initiate unjustified lawsuits. And also that the Commission's forms of coercive regulation pose a threat to the US digital market and investors.

The other day, the CEO of Grayscale Investments explained
The SEC's refusal to approve the launch of a Bitcoin ETF is due to the regulator's inability to control the cryptocurrency market.