In their latest filing, Coinbase said that the Secretary of Education exceeded their authority by canceling a large amount of student debt.
In their latest filing on Wednesday, July 12, lawyers representing crypto exchange Coinbase said that the recent judgment by the US Supreme Court on student debt cancelation could be beneficial to them in their defense against the US Securities and Exchange Commission (SEC).
Last month in early June, the SEC charged Coinbase on the account of a breach of federal securities laws. Coinbase has responded stating that the lawsuit is an attempt by the SEC to exert “extraordinary wholesale power” over the broader crypto industry.
The recent filing mentions a Supreme Court ruling from June 30, which stated that the Secretary of Education exceeded their authority by canceling a large amount of student debt. This ruling highlights the requirement for government agencies to have clear support from Congress for decisions of significant economic or political impact.
Coinbase believes that a similar case, referred to as Biden v. Nebraska, will have an impact on their own case because there are still no clear rules in place by lawmakers specifically for cryptocurrencies. The Coinbase filing reads:
“Far from granting the ‘clear congressional authorization’ required for the SEC to exercise such authority, Congress has expressly recognized that it has not yet delegated such regulatory authority and is actively considering regulatory structures for the digital asset industry.”
On further hearing of the Coinbase filing, the parties will meet in a New York courtroom later today for a preliminary hearing in a trial that could potentially last for years. In a separate case, Coinbase recently won a victory in the Supreme Court when judges ruled that a lawsuit against the exchange by a user could not proceed until after an appeal.
Coinbase CEO Responds to BofA Blocking Accounts
In another development, it has come to light that Bank of America has been blocking accounts that have been transacting with Coinbase. On Twitter, Muneeb Ali, co-founder of blockchain firm Stacks, appraised regarding the closure of his personal account with Bank of America after 15 years. Ali said that there was no reason for the closure, but he alleged that it was because he had used the account to transact with Coinbase for Bitcoin investments.
Coinbase CEO Brian Armstrong has taken cognizance of the matter saying that he was “curious if this is the issue”. The Coinbase chief started a Twitter poll asking his followers about the current development.
Has @BankofAmerica closed your account due to transactions with @coinbase? Curious if this is the issue.
— Brian Armstrong 🛡️ (@brian_armstrong) July 13, 2023
The Coinbase chief received over 8,500 responses of which about 9% of respondents said yes, while 20% said no. The global banking sector has become increasingly skeptical of the cryptocurrency industry in recent months, following a $1.5 trillion sell-off last year, a series of high-profile digital asset failures, and growing regulatory scrutiny.
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
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