Coinbase, a U.S.-based cryptocurrency exchange, has officially urged the Department of Justice to establish nationwide clarity regarding regulatory conflicts at the state level. The company’s legal director, Paul Grewal, expressed concern over the fragmented legal structure adversely impacting the industry.
Conflict Between State and Federal Regulations
Coinbase’s plea highlights a lawsuit filed in Oregon. Oregon Attorney General Dan Rayfield initiated legal action in April, accusing the exchange of promoting unregistered cryptocurrency sales within the state. This process commenced following the Securities and Exchange Commission (SEC) dropping its lawsuit against Coinbase in February.
Through a post on his X account, Grewal noted that states were leveraging overly broad interpretations contrary to federal law. Consequently, Coinbase took the lawsuit to the Oregon District Court in June and filed another lawsuit in July against the state’s governor, Tina Kotek.
Rayfield, speaking earlier, argued that federal agencies had withdrawn from lawsuits under the new administration, urging states to fill the void. This further highlighted the conflict between federal and state regulations.
Coinbase’s Regulatory Proposals
In their submission to the Department of Justice, Coinbase emphasized the necessity for Congressional action. The pending CLARITY Act and 2025 Responsible Financial Innovation Act were singled out as potential frameworks for achieving national uniformity. The company advocated for a comprehensive “preemption” mechanism to eliminate interstate differences.
Grewal stated that the current fragmented structure generates inefficiencies and undermines consumer confidence. Despite the positive steps taken during the Trump administration, Coinbase’s appeal indicates that regulatory uncertainty persists in the cryptocurrency sector. Industry players believe that clear regulations are crucial for investor protection.
