- Coinbase has released internal U.S. Securities and Exchange Commission (SEC) documents revealing the agency’s hesitance to classify Ethereum and XRP as securities
- The New York Attorney General’s office sought the SEC’s support in declaring Ethereum a security during a 2023 case against KuCoin, but the SEC declined
- The documents highlight the SEC’s internal debates and lack of clear regulatory stance on major cryptocurrencies
Coinbase has published a trove of internal communications from the U.S. Securities and Exchange Commission (SEC), exposing the agency’s wavering position on whether Ethereum and XRP qualify as securities. In 2023, the New York Attorney General asked the SEC to back its legal efforts to label Ethereum as a security during a lawsuit against KuCoin, but the SEC refused to take a position. The documents showcase the SEC’s ongoing uncertainty and regulatory inconsistency concerning top cryptocurrencies.
NYAG Pressed for Ethereum to Be Declared a Security
In mid-2023, the New York Attorney General’s office reached out to the SEC with a formal request: support its claim in court that Ether should be considered a security. The Attorney General’s office believed a legal precedent would enhance investor protections, but the SEC ultimately chose not to intervene, illustrating its reluctance to draw a clear line on Ethereum’s status.
Internal emails further reveal the SEC’s continued debate over XRP. In one exchange, SEC staff members speculated whether Ripple’s blockchain could function independently of the company—raising questions about XRP’s decentralization. These conversations took place while the SEC was already embroiled in a high-profile lawsuit against Ripple, in which it alleged that the company had sold unregistered securities.
Coinbase Calls for Regulatory Clarity
The release of these documents is part of Coinbase’s broader push to pressure U.S. regulators to define clearer cryptocurrency policies. The exchange has positioned itself as a defender of transparency in the crypto industry, repeatedly urging lawmakers and regulatory agencies to provide precise guidance for digital asset classification. By bringing these internal debates to light, Coinbase is spotlighting the fragmented and sometimes contradictory approach taken by financial regulators.
The insight offered by these disclosures reflects the broader struggle regulators face in adapting traditional financial rules to the decentralized world of cryptocurrencies. Industry leaders, investors, and legal experts continue to call for a standardized framework that supports innovation while protecting consumers.
