Brian Armstrong, the CEO of Coinbase, hit back at the Securities and Exchange Commission (SEC) yesterday (Wednesday) following the agency’s lawsuit against the exchange, calling its Chair, Gary Gensler an “outlier.”

Coinbase's CEO Attacks SEC's Chair

“The SEC chair is really an outlier,” said Armstrong, who also dragged the US securities agency to court for clarification on its crypto rules. While speaking at the Bloomberg conference, he assured that the funds of Coinbase's customers are safe.

The SEC brought the lawsuit against Coinbase on Tuesday, a day after it hit Binance and its CEO with harsh charges. According to the regulator, Coinbase operates an illegal exchange and offers trading with unregistered securities.

The securities market regulator flagged at least 13 crypto assets listed on the American exchange, labeling them as unregistered securities. These include Solana, Cardano, and Polygon.

Gensler, who became the SEC’s Chair in April 2021, maintained his stance that most cryptocurrencies are securities. US President’s Working Group on Financial Markets also agreed that some stablecoins, crypto assets pegged to fiats and other assets, might be securities.

On top of that, Armstrong revealed that his exchange approached the SEC earlier for registration but received an “icy reception” from Gensler at the first meeting.

Coinbase CEO @brian_armstrong calls out Gary Gensler’s claim that the SEC is being “neutral” on whether crypto has a use case:

“We don’t need the government picking and choosing our technology winners; let’s let the market decide that.” 👏 pic.twitter.com/EjH5CMiY9c

— Coinage (@coinage_media) June 7, 2023

Meanwhile, a letter from Binance’s lawyers to the SEC officials revealed that Gensler “acknowledged the regulatory uncertainty around cryptocurrency and offered to serve as an advisor” to the crypto exchange he is after now.

“Mr Gensler should have been recused from any consideration in this matter based on this history and the prospect that Mr Gensler may be a material fact witness,” the letter added. “To date, the Staff has never confirmed whether Mr Gensler has recused himself, and if he has not, the Commission’s explanation for why not.”

Coinbase and Binance - Two Different Cases

Though the lawsuit against Binance and Coinbase came simultaneously, the charges against them are very different. The regulator charged Binance, its two US affiliates, and its CEO for running an illegal exchange, wash trading, and even misappropriating customer funds. Binance has been blamed for redirecting $12 billion of customer funds to Changpeng Zhao-controlled firms.

“In Coinbase’s case, for instance, there hasn’t been any allegation of misappropriation of customer funds,” Armstrong told CNBC.

COINBASE CEO BRIAN ARMSTRONG:

This isn't good for America, we need clarity from the courts.

It's tough to know what Gensler is talking about.

We don't list any securities today.

We met with SEC 30 times in the last year and we never got feedback, just silence. pic.twitter.com/UfW61ZmHJw

— Bitcoin News (@BitcoinNewsCom) June 7, 2023

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