The Blockchain Association and the Crypto Freedom Alliance of Texas sued the SEC over the newly adopted dealer rules.
The Blockchain Association and the Crypto Freedom Alliance of Texas have sued the U.S. Securities and Exchange Commission over newly adopted dealer rules they say will have a “catastrophic impact” on the industry.
Both groups filed lawsuits against regulators Monday in U.S. District Court in Texas, accusing the SEC of violating the Administrative Procedure Act. — Laws that regulate how federal agencies develop and issue rules. The Blockchain Association is supported by the following members: Coinbase, Digital Currency Group, Uniswap, and Kraken, among others.
The groups are seeking a court order to ‘strike down’ the new rules.
“Before these aggressive regulators do more damage, we are seeking declaratory judgment and injunctive relief to overturn the SEC’s expansion of the rule and ban its use for the industry,” Kristin Smith, CEO of the Blockchain Association, said in a statement. “We are looking for them,” he said.
SEC’s new rules
SEC voted In February, we will adopt rules requiring: To comply with federal securities laws, market participants with significant liquidity-providing roles use a mix of cryptocurrencies. The 247-page rule applies to those trading cryptocurrency assets that meet the definition of securities or government securities, unless the assets are worth less than $50 million. This rule was repeated in DeFi and received significant backlash from cryptocurrency industry groups at the time.
Blockchain Association and The Crypto Freedom Alliance of Texas said the SEC violated the APA by “exceeding its statutory authority” when defining dealers by adopting this rule, and that stakeholders are concerned about how the rule will apply to digital assets and DeFi. It said the questions and concerns raised were ignored.
“In short, the Commission has inexplicably refused to grant exemptions to the digital asset industry or consistently explain how and when the rules will apply to new markets,” the group said in the complaint.
Compliance date rule It has been one year since it took effect on April 29, 2024.
“The Commission conducts rulemaking consistent with the authorities and laws governing administrative procedures and will vigorously defend the final dealer rule in court,” an SEC spokesperson said in a statement to The Block.
Other lawsuits against the SEC
The lawsuit is one of a few filed against regulators last year.
The Texas Crypto Freedom Alliance also be sued The SEC filed a lawsuit in February in a Texas court with digital asset company LEJILEX over the agency’s “unlawful targeting” of the cryptocurrency industry. DeFi Education Fund and Texas Apparel Company Beba File SEC court Last month, it asked the court to declare that the $BEBA token airdrop was not a security due to violations of the APA.
Last year, cryptocurrency exchange Coinbase also filed a lawsuit against the SEC. get The agency may agree or deny the rulemaking petition.
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