No, in most cases, Congress makes laws that say things like “we delegate our rule making authority to the EPA with regards to air pollution” (Clean Air Act). The agencies then create the rules; https://en.wikipedia.org/wiki/Code_of_Federal_Regulations
Sometimes the court system decides the agency’s rules exceed the authority granted to them by Congress.
Other times Congress uses the Congressional Review Act or new legislation to say “that’s not what we meant”.
The laws pertinent to the SEC's complaint are the '33 Act, '34 Act and court cases which constructed the Howey Test. None of them were created by the SEC.
The '33 and '34 Acts give the SEC the ability to write the regulations, via wording like "under rules
and regulations which the Commission shall prescribe". Congress defines a variety of things, but the SEC makes most of the nitty gritty procedure/rules out of those definitions and directives.
The Howey test exists because the SEC enforced said new-ish regulations against someone, and the court agreed with them, holding Howey liable for violations of the '33 Act as implemented by regulators at the SEC.
All this makes the statement "No, Congress creates the rules" upthread inaccurate.
What? The laws Coinbase is being charged with violating are creatures of the Congress and courts, not the administrative state. This is not a case of "the agency that enforces the rules is also charged with creating them" [1].
Coinbase wants the SEC to come up with a process for them to register with the SEC that's amenable to cryptocurrency, via a "petition for rulemaking"; https://www.sec.gov/rules/petitions/2022/petn4-789.pdf. (The SEC is, rightly IMO, saying "nah".)
Again, the point is that both Congress and the SEC make "the rules" around securities. Congress defined securities and gave the SEC the ability to write the rules for securities, with some specific requirements. The SEC's rules can't violate the various Acts of Congress, but they've still got quite a bit of rule-making power delegated to them.
> Congress defined securities and gave the SEC the ability to write the rules for securities, with some specific requirements
Right. Like choosing what's important and what's not. (It's also a totally dishonest framing by Coinbase. Their business model, a unified broker, exchange and custodian, is fundamentally in violation of the '34 Act. They're asking the SEC to break the law.)
What makes no sense to me is the stupidity of fighting the case. I understand Coinbase's PR rallying the crypto base before. They were making a lobbying push to change the law. And the base would throw money at them. But now? Either management has reason to believe they can run out the clock on the SEC before Congress changes the rules. Or they're as delusional as the base.
