The Securities and Exchange Commission denied Coinbase’s request for the agency to develop a new regulatory framework for cryptoasset securities.

Background: Coinbase last year petitioned the SEC to develop regulations tailored to crypto securities. SEC Chairman Gary Gensler has repeatedly said the vast majority of crypto tokens meet the Howey Test, which is the standard for determining what may qualify as a security, demonstrating his opposition to a distinct regulatory regime for crypto.

SEC Response: In a statement following the agency’s 3-2 vote rejecting the request, Gensler said existing laws and regulations apply to the crypto securities markets and that the agency is already developing rules to address the crypto securities markets. He also said the agency must maintain discretion in setting its own rulemaking priorities.

Dissenting Views: SEC Commissioners Hester Peirce and Mark Uyeda, who voted against the decision, separately said the agency should hold public conversations on crypto oversight and use what it has learned to issue guidance or engage in any rulemaking.

ICBA View: ICBA has said it supports the SEC’s efforts to apply securities laws and regulations to crypto entities because it agrees that most cryptoassets likely qualify as securities. It has separately said the International Organization of Securities Commissions’ policy recommendations for digital assets markets—the first attempt to establish baseline crypto policies—are prudent steps to safeguard the financial system from crypto.

More: Recent Main Street Matters posts from ICBA Senior Vice President of Digital Assets and Innovation Policy Brian Laverdure cover recent crypto collapses, the evolving regulatory environment for digital assets, and the policy debate over treating cryptoassets as securities or commodities.