The Securities and Exchange Commission (SEC) promises to provide a response to the Coinbase crypto exchange petition on the rules for regulating cryptocurrencies in the United States within four months.

Coinbase filed a petition last summer. The crypto exchange demanded that the regulator clarify the powers of the Commission in overseeing the digital asset market. The main question is whether the current securities regulatory framework covers cryptocurrencies. After ignoring the SEC petition, Coinbase went to court and forwarded the petition to the SEC several times.

In a recent response from Coinbase, the SEC clarified that the Commission is currently reviewing a motion for action by Coinbase itself, which was sued by the regulator last Tuesday. According to the lawsuit, Coinbase has been operating in the country since 2019 as an unregistered broker and trades in cryptocurrencies, which are securities.

Although Coinbase claimed that the SEC had already decided to dismiss the petition, the agency responded that it had not yet made a decision. Agency staff will respond to the petition within 120 days. Until the SEC decides to propose new rules, Coinbase must still comply with current legislation, the regulator added.

“And Coinbase can strongly defend its position that it has not violated this law in its current enforcement actions,” the SEC said.

Bank of America recently downgraded crypto exchange Coinbase stock to “below average” due to a SEC lawsuit.