Coinbase Lawyers Argue Biden Student Loans Ruling Aids Defense Against SEC

A recent U.S. Supreme Court judgment on student debt cancellation aids Coinbase’s fight against charges of operating an unregistered securities venue, lawyers for the crypto exchange argued in a .

On June 6, the with breaching federal securities law. The exchange says the lawsuit is a bid by the regulator to exert “extraordinary wholesale power” over the $1 trillion digital asset industry and represents a breach of powers of the kind judges recently ruled unlawful.

It's referring to a Supreme Court ruling on June 30, just days after , that the Secretary of Education had by canceling around $430 billion in student debt, reinforcing a legal doctrine that says that government agencies need clear support from Congress if taking a decision of major economic or political significance.

Coinbase says that “closely analogous” case, cited as Biden v. Nebraska, will have a bearing on its own, because lawmakers still haven’t set out clear rules for crypto.

“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,” said Coinbase’s filing.

U.S. lawmakers are considering a range of digital asset laws, including a recently revived by Senators Cynthia Lummis (R-Wyo.) and Kirsten Gillibrand (D-N.Y.) which favors giving authority to the Commodity Futures Trading Commission (CFTC) rather than the SEC.

The SEC has argued that digital assets including the tokens tied to Solana (SOL), Cardano (ADA), and Polygon (MATIC) constitute regulated securities, and that the Coinbase by failing to register its activities. The regulator has also made similar allegations against rivals and . All three companies have denied the charges, arguing the regulator has no jurisdiction.

The parties meet later Thursday in a New York courtroom in a trial that could potentially drag on for years. In a separate case, Coinbase recently scored a when judges ruled that a lawsuit taken against the exchange by a user couldn’t proceed until after an appeal.

Edited by Sheldon Reback.