Coinbase joins ASA in opposing SEC's $2.6 billion budget request

Coinbase recently expressed its opposition to the US Securities and Exchange Commission’s (SEC) proposed $2.6 billion budget for fiscal year 2025.

In a statement to the media on June 13, a Coinbase representative noted: “The SEC is once again asking for more funding to strengthen enforcement oversight, but its massive budget is not really being used for cryptocurrency rulemaking, and clear rulemaking would have improved Regulatory transparency.”

The SEC's budget request plans to spend $812.4 million on enforcement, an increase from $675.6 million in 2024. SEC Chairman Gary Gensler said the budget would increase the number of full-time positions in law enforcement by 27 to 1,447, strengthening the ability to investigate misconduct and prosecute complex prosecutions.

Coinbase has repeatedly called on the SEC to reduce enforcement efforts and instead formulate clear regulations, and has sought responses through rulemaking petitions and legal channels. On May 31, the exchange issued a statement criticizing the SEC’s changing stance for bringing uncertainty and confusion to the market rather than clear regulatory guidance.

ASA calls for SEC budget cuts

The American Securities Association (ASA) also expressed opposition to the SEC’s budget request and proposed in a June 13 letter that the Senate Appropriations Committee should provide SEC enforcement agencies with less funding than the president’s budget request.

ASA believes that the Senate Appropriations Committee should follow the House Appropriations Committee’s recommendation and limit the SEC’s fiscal year 2025 budget to $2 billion, with the law enforcement budget set at $644 million. ASA also urges Congress to hold the SEC accountable and require it to focus on investor protection, market order and fairness, and capital formation.

The ASA is asking for a ban on the SEC collecting certain information, as well as an investigation into the regulator's operations, as well as mandatory reporting. The ASA stated: “The SEC’s actions appear to ignore the constraints of the Constitution and federal law.”

While the ASA’s concerns are not limited to the cryptocurrency space, the industry association has called for an investigation into the SEC’s mishandling of cryptocurrency company cases and urged Congress to hold regulators accountable.

Conclusion:

Coinbase and the ASA’s joint opposition reflects widespread concerns about the SEC’s budget and regulatory approach. Both agencies believe that the SEC should reduce its reliance on enforcement and instead formulate clear regulations to promote the healthy development of the market and investor protection.

As the cryptocurrency market continues to mature, the role and approach of regulators should adapt accordingly to ensure effective regulation while safeguarding the market's potential for innovation and growth.

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