Former Chief of the SEC Office of Internet Enforcement, John Reed Stark, has criticized Coinbase Global Inc's defense against the markets regulator. The trading platform's argument that the regulator approved its IPO and therefore has a good understanding of its business is flawed, according to Stark.

He explained that the SEC's role in IPO filings is to review whether the applying company made the right disclosures, and the commission always issues a disclaimer that legally recuses it from the same claims that the exchange plans to use as a cover. Coinbase has two lawsuits pending with the US SEC, and the legal battle will be a long haul for the trading platform.