The Securities and Exchange Commission (SEC) set up a challenge on whether some tokens were securities, and Coinbase went ahead and slapped the agency with a glove.

Also, a quick personal note: I’ll be at the Asian American Journalists Association annual conference in Los Angeles this week. If you’re also going, say hi! CoinDesk will be at booth 310.

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The Securities and Exchange Commission (SEC) alleged that nine cryptocurrencies are securities.

The SEC calling a cryptocurrency a security is not new. What is new is it doing so in a legal filing that doesn’t directly address the issuers of the tokens. The regulator appears to be laying the groundwork for bringing crypto trading platforms more fully into its umbrella.

So, uh, did the U.S. Securities and Exchange Commission just announce that Coinbase, a publicly traded company it oversees, illegally listed noncompliant securities in an insider trading complaint?

(*Monday night edit: Lol. See below for more.)

The SEC alleged that nine cryptocurrencies, several of which are listed on Coinbase, are securities, in a complaint against three individuals arrested for insider trading (the Department of Justice also filed charges; it’s worth noting that Coinbase is not the defendant in any of these charges).

The full list includes Flexa's amp (AMP), rally (RLY), the rari governance token (RGT), derivaDAO (DDX), XYO (XYO), LCX (LCX), powerledger (POWR), DFX finance (DFX) and kromatika (KROM).

This appears to have taken everyone by surprise.

In a statement shared with CoinDesk, a Flexa spokesperson said the company was “not contacted by the SEC” prior to the complaint being released and has “significant questions about the conclusions regarding AMP.”

The CEO of LCX tweeted that his token was approved by legal counsel and recognized as being a nonsecurity outside the U.S. (though it’s worth bearing in mind that even if something is not a security outside the U.S., it may still be a security within the U.S.)

It seems a fair assumption that the SEC must be planning on taking further action here. That could look like an enforcement action against Coinbase or against the issuers, but the base of this allegation is that these nine cryptocurrencies are unregistered securities. It’s hard to imagine the SEC enforcement team shrugging its shoulders and saying “mission accomplished, time to move on” without doing anything further.

It’s likely going to be a legal fight though.

Coinbase published a blog post, authored by Chief Legal Officer Paul Grewal, saying “we … 100% disagree with the SEC’s decision to file these securities fraud charges and the substance of the charges themselves.”

The exchange went a step further: “Seven of the nine assets included in the SEC’s charges are listed on Coinbase’s platform. None of these assets are securities,” Grewal wrote.

It’s worth pointing out that the SEC laid out why it believes these cryptocurrencies are securities in the complaint, detailing how the agency’s attorneys applied the Howey Test to each asset. Coinbase – so far at least – has not detailed why it believes the assets are not securities.

It’s an open question as to what happens next. Typically, when the SEC says a certain asset is a security, it does so through either an enforcement action against or a settlement with the issuer.

That didn’t happen here.

You normally see exchanges rushing to delist or suspend trading in the alleged securities.

Again, that didn’t happen here.

The SEC is challenging Coinbase, and Coinbase for its part is challenging the regulator right back.

One frequent complaint about the SEC is that it is not providing clear regulatory guidelines for the industry. The counter to this viewpoint is that the Howey Test and other existing laws and regulations do, in fact, address how securities laws can or should apply to digital assets.

Last week’s action would suggest the SEC is continuing to support this latter view. Again, one of the remarkable aspects is that the SEC dedicated several pages of its complaint to explaining just why, in its view, the named assets are securities.

And SEC Chair Gary Gensler’s been pretty clear about his endgame. He wants cryptocurrency exchanges (namely, Coinbase, as one example) to register with the regulator as national securities exchanges.

Identifying assets already listed is a pretty dramatic step toward encouraging Coinbase to register (read: forcing).

To add to the oddness of Thursday’s actions, two Commodity Futures Trading Commission (CFTC) officials also weighed in, saying their agency could have brought charges.

One of the statements, by Commissioner Caroline Pham, even took aim at the SEC for “regulation by enforcement,” before going on to suggest that the tokens may not be securities.

“The SEC complaint alleges that dozens of digital assets, including those that could be described as utility tokens and/or certain tokens relating to decentralized autonomous organizations (DAOs), are securities,” Pham said in her statement.

(While other jurisdictions have detailed what a “utility token” may look like, the U.S. has so far not formally acknowledged the potential for a token to be a utility token, to the best of my knowledge.)

In a tweet from her personal account, Pham later said that the CFTC also has insider trading jurisdiction.

Commissioner Kristin Johnson likewise said in a statement that the different financial market regulators “stand united.”

“We must continue to work collaboratively to adopt a whole-of-government approach to prevent bad actors from taking advantage of important policy and regulatory debates and to ensure the protection of retail investors and preservation of the safety and soundness of our financial system,” Johnson said.

Admittedly I’ve only really been paying attention for a handful of years now, but I’ve never seen officials with a government agency weigh in on another agency’s enforcement action quite like this before.

By the way, in what appears to be a coincidence, Coinbase petitioned the SEC to ask for regulatory clarity, saying existing securities laws do not necessarily fit the digital asset infrastructure.

And on Monday night, Bloomberg reported that the SEC was looking into Coinbase for possibly listing securities. Gee, I wonder if the agency’s enforcement division has any specific assets in mind?

Michael Barr has been sworn in as the Fed’s vice chair for supervision, and the SEC has a full slate of commissioners after Jaime Lizárraga was sworn in last week.

If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at nik@coindesk.com or find me on Twitter @nikhileshde.

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See ya’ll next week!