Crypto.com sued the SEC: the exchange demands to stop Gensler’s arbitrariness
International cryptocurrency platform Crypto.com (operated by Foris DAX Markets Inc.) has gone on the legal offensive by filing a federal lawsuit against the U.S. Securities and Exchange Commission (SEC) and its Chairman Gary Gensler in the U.S. District Court for the Eastern District of Texas (Tyler). The statement of claim immediately followed the delivery of an official Wells Notice to the exchange by the US Securities and Exchange Commission (SEC), in which the regulator threatened enforcement action against spot transactions with altcoins.
Crypto.com co-founder and CEO Kris Marszalek publicly confirmed the filing of the lawsuit in an address on the social network X, as well as on official statement on the company’s website, emphasizing that the exchange has exhausted all diplomatic avenues of interaction with the supervisory authority. The platform’s management claims that the SEC’s aggressive enforcement policy has gone beyond the powers established by Congress and is aimed at destroying legal crypto businesses in the United States, bypassing the established rulemaking procedure.
What are the main legal claims of Crypto.com to the regulator?
In the lawsuit, the exchange’s legal team relies on the provisions of the Administrative Procedure Act (APA) and recent precedents of the US Supreme Court:
- Exceeding Jurisdiction Without Congressional Approval (Major Questions Doctrine)
- Violation of the public consultation procedure when expanding the term “security”
- Unreasonable equating of secondary transactions with network tokens to investment contracts
- Filing a joint petition with the SEC and CFTC to delineate derivatives markets
The principle of the rule of law and the doctrine of important issues
The plaintiffs claim that the SEC arbitrarily established an unspoken rule according to which almost all digital tokens are recognized as securities, except for Bitcoin and Ethereum. Such a change in the financial landscape requires direct legislation from legislators, not ad hoc lawsuits by individual officials.
Lack of clear registration rules
The exchange indicates that for many years it has in good faith requested from the regulator standards for registering platforms for trading digital assets. Instead of regulatory clarifications, the agency responded with threats of legal prosecution, making the legal activities of American units impossible.
What petition did the crypto exchange send to the supervisory agencies CFTC and SEC?
In parallel with the filing of the lawsuit in Texas, a subsidiary of Crypto.com – derivatives platform CDNA (Crypto.com Derivatives North America) – filed a formal petition with the Commodity Futures Trading Commission (CFTC) and the SEC:
- Requirement to recognize perpetual contracts and derivatives as the exclusive area of CFTC supervision
- Consolidating the status of crypto assets as basic commodities
- Ban on duplicate inspections by the Gary Gensler Commission
Delimitation of spheres of influence of regulators
The management of the exchange seeks to legally confirm that spot digital assets are exchange-traded commodities, which means that oversight of the associated settlement contracts should be carried out exclusively by the Commodity Futures Trading Commission (CFTC), which traditionally takes a constructive approach to the industry.
How does the legal front in Texas change the balance of power for the crypto industry against the SEC?
The opening of litigation in the Eastern District of Texas is of strategic importance for the entire American blockchain industry.
Choice of a conservative and precedent-based judicial platform
The U.S. District Court for the Eastern District of Texas and its 5th Appellate Circuit are known for their tough stance on U.S. federal agency overreach. Previously, it was in this district that technology associations successfully blocked SEC regulatory directives to supervise hedge funds and dealers.
Creating a united front of resistance
Crypto.com’s lawsuit joins forces with similar lawsuits launched by Coinbase, Consensys and the DeFi Education Fund Alliance. Coordination of the legal strategies of leading market participants increases the chances that the dispute over the SEC’s powers will reach the US Supreme Court, where the regulator’s position looks extremely vulnerable.
The crypto market isn't just about numbers—it's a complex ecosystem where politics, technology, and economics intertwine. In my news coverage, I strive not merely to recount events, but to analyze their real impact on the market. My goal is to make cryptocurrency news clear, accessible, and objective.
