Chief Legal Officer of Coinbase, Paul Grewal, spoke to lawyer John Deaton, host for the Twitter-based podcast CryptoLaw, regarding the exchange’s decision to continue offering Algorand (ALGO).
The U.S. Securities and Exchange Commission (SEC) earlier classified Algorand as a security in its charges against the Bittrex crypto exchange.
Notably, Coinbase delisted XRP based on regulatory scrutiny in 2021. But it has yet to do the same with ALGO, even as the cryptocurrency faces a similar issue.
Paul Grewal Explains Coinbase Position On Algorand
In his interview, John Deaton discussed the confusion among XRP’s community regarding Coinbase’s approach to making and reviewing listing decisions.
Paul Grewal stated that secondary sales of assets do not make them securities. However, Deaton believes that the same argument regarding secondary sales applies to XRP tokens.
According to Deaton, XRP’s suspension from trading on Coinbase was due to the argument that the token is a security under U.S. law.
However, Coinbase still offers ALGO to traders, frustrating XRP holders who feel penalized. In response, Grewal reiterated Coinbase’s commitment to upholding the rule of law equally for everyone. He sympathized with the plight of XRP holders who believe that a double standard applies to various situations.
Further, Grewal states that laws and circumstances changed and referred to Coinbase’s amicus brief supporting Ripple in November 2022. He believes crypto exchanges and projects must “team up to withstand a solid adversary,” the U.S. SEC.
According to Grewal, the SEC is not “above mistakes” in interpreting the law, and the recent enforcements from the body are politically motivated.
Teamwork Necessary Moving Forward
These remarks come after a meeting between Paul Grewal and Ripple’s General Counsel, Stuart Alderoty. John Deaton remarked that the meeting showed two great General Counsels leading the front line in the battle to improve crypto regulation in the United States.
Two great GCs leading the front line in battle. I tip my Gents. https://t.co/YYVBf5wl5h
— John E Deaton (@JohnEDeaton1) May 3, 2023
John Deaton had recommended in a tweet in March 2023 that crypto companies facing SEC enforcement actions need to share ideas. He believes they can create coordinated strategies to defend themselves against the commission and its “excesses.”
Also, Attorney Bill Morgan reacted to the meeting between Coinbase and Ripple’s top legal officers. He believes nothing is “better than teamwork against a common enemy.” Interestingly, Ripple and Coinbase faced regulatory pressure from the SEC on different occasions.
The SEC charged Ripple for offering XRP tokens as unregistered securities in 2020. While the case continues, the commission served a Wells Notice to Coinbase in February 2023.
Meanwhile, some XRP enthusiasts have called on Coinbase to relist XRP. According to XRPcryptowolf, Coinbase must relist XRP if they “desire Ripple’s help to defeat the SEC.”
Featured image from Coinbase and chart from Tradingview