On August 12, Coinbase Chief Legal Officer Paul Grewal wrote on the X platform that Coinbase today submitted an objection to its proposal to expand the definition of "exchange" to the Securities Exchange Commission (SEC). The SEC's proposal lacks critical analysis, is based on unreasonable assumptions, does not prove the existence of problems requiring regulation, and grossly exaggerates the benefits of the proposal. The following are the main concerns: 1. Lack of economic analysis: The SEC failed to gather basic information or conduct economic analysis to evaluate the proposed impact on decentralized exchanges (DEXs), but still advanced its unreasonable assumptions. 2. Potential impact on DEXs: Coinbase emphasizes that the SEC should not extend the proposal to DEXs because it could have a significant impact on the millions of Americans who use digital assets and could harm innovation in the growing DEX market. 3. The existence of a hypothetical problem: The SEC started by assuming that there was a problem in the industry that needed to be corrected, but failed to prove the existence of the problem. Coinbase believes that this is not the right way to set the rules and that the proposal should at least be withdrawn and amended. Ongoing dialogue with the SEC: Coinbase expresses its gratitude to the SEC for the careful consideration of its comments and looks forward to further discussions on this important topic.