Coinbase, one of the leading cryptocurrency exchanges in the United States, is currently embroiled in a legal battle with the U.S. Securities and Exchange Commission (SEC) over the need for clear and precise regulation in the crypto industry. The clash between Coinbase and the financial regulator came to a head on Monday, September 23, as they faced off in a federal appeals court in Philadelphia.

According to a report by Reuters, Coinbase has been pressuring the SEC to establish a more favorable regulatory environment for crypto assets in the U.S. The exchange filed a petition last December, arguing that the current regulatory framework for cryptocurrencies is “unworkable.” However, the SEC rejected Coinbase’s petition, prompting the exchange to escalate its efforts to push for clearer regulations.

During the court proceedings, Coinbase’s lawyer, Eugene Scalia, accused the SEC of withholding crucial information on how crypto companies can register with the agency and comply with U.S. laws. Scalia emphasized that the SEC’s stringent regulations are hindering the growth and operation of crypto companies in the country.

On the other side, SEC lawyer Ezekiel Hill defended the regulator’s stance, stating that Coinbase should not expect special treatment or a new set of rules if it chooses to operate outside the existing regulatory framework. Hill argued that the SEC is taking a cautious approach to rulemaking and questioned why cryptocurrency should be exempt from regulatory oversight.

The legal dispute between Coinbase and the SEC dates back to last year when the regulator sued the exchange for failing to register as a broker while conducting business in the U.S. Additionally, the SEC claimed that Coinbase’s staking program and several digital assets offered on its platform should be classified as securities.

In response to the SEC’s actions, Coinbase filed a lawsuit against the regulator and the Federal Deposit Insurance Corporation for failing to provide requested information under the Freedom of Information Act. The ongoing legal battle between Coinbase and the SEC highlights the growing tension between the crypto industry and regulatory authorities.

As the case unfolds in the courts, the outcome will have significant implications for the future of crypto regulation in the U.S. and could set a precedent for how other cryptocurrency exchanges and companies navigate the complex regulatory landscape. The clash between Coinbase and the SEC underscores the urgent need for clear and transparent regulations to foster innovation and growth in the crypto industry.