• Coinbase’s Chief Legal Officer, Paul Grewal recently made an argument against the SEC interpretation of digital assets.
• He used the Major Questions Doctrine, a legal principle recently upheld in a Supreme Court case on student loan forgiveness to challenge the SEC’s broad interpretation.
• The recent Supreme Court decisions have been increasingly polarizing, leading critics on the left to suggest that Congress should address this issue through legislation instead of leaving regulation up to the SEC.

Coinbase Challenges SEC Interpretation of Digital Assets

Coinbase’s Chief Legal Officer (CLO), Paul Grewal, has challenged the US Securities and Exchange Commission (SEC)’s broad interpretation of digital assets by referencing a recent Supreme Court decision on student loans. This decision upheld a legal principle known as the Major Questions Doctrine which prevents agencies from making decisions of major significance without clear congressional authorization. Grewal argued that if “Swap out ‘Secretary’ for ‘Chair,’ ‘digital asset’ for ‘student loans,’ and there is no conclusion but one: the SEC’s interpretation of ‘investment contract’ violates the law“.

The Polarizing Nature Of Recent Supreme Court Decisions

The latest series of decisions made by the US Supreme Court have become increasingly polarizing with critics from both sides voicing their opposition. Specifically those on the left are pushing for Congress to address this issue through legislation rather than leaving it up to regulatory bodies such as the SEC. These challenges come after several controversial rulings including one in favor of a Christian web designer who refused to create websites for same-sex weddings due to religious objection.

Major Questions Doctrine

Grewal referred back to legal principle known as Major Questions Doctrine which was backed by a recent ruling from US Supreme Court about student loan forgiveness. This doctrine prevents agencies from making major decisions without prior congressional authorization and its application here would limit what authority can be given over digital assets by regulatory bodies like The Securities and Exchange Commission (SEC).

Coinbase CLO’s Argument Against The SEC

Grewal argued that if „Swap out ‚Secretary‘ for ‚Chair,‘ ‚digital asset‘ for ’student loans,‘ and there is no conclusion but one: the SEC’s interpretation of ‚investment contract‘ violates the law“. He also added that claiming authority over all digital assets other than Bitcoin has an economic and political significance that is not easily enforceable between enterprise and purchaser leading him to argue against this stance taken by The Securities and Exchange Commission (SEC).


As seen with Coinbase CLO’s argument against The Security & Exchange Commission (SEC) applicable laws must be followed when it comes to interpreting investment contracts involving digital assets. Furthermore, with increasing polarization surrounding recent supreme court decisions many are pushing congress for direct action rather than relying on regulatory bodies such as The Security & Exchange Commission (SEC) when it comes interpreting these contracts involving digital assets.