Crypto startup Lejilex and the United States Securities and Exchange Commission (SEC) are engaged in a legal battle over the classification of cryptocurrencies. Both parties have submitted competing briefs for summary judgment in a Texas federal court.

Lejilex, which is part of the Crypto Freedom Alliance of Texas, filed its brief on October 3. The company argues that it intends to facilitate crypto transactions and not to sell securities. In its filing, Lejilex accuses the SEC of overstepping its regulatory authority.

SEC Defends Stance on Securities

In its brief, Lejilex contends that the SEC seeks to broadly classify asset sales as security transactions. The company claims that the SEC has maintained an approach that allows for a “transformative expansion” of its regulatory power without any limitations.

Conversely, the SEC argues that the lawsuit attempts to convince the court that should never be considered securities. The SEC has also raised the issue of standing, asserting that Lejilex has not faced any agency enforcement actions against it.

Earlier this year, in February, Lejilex requested the court to determine that listing pre-existing tokens would not violate securities laws. Co-founder Mike Wawszczak expressed frustration, stating: “We wish we were launching our business instead of filing a lawsuit, but here we are,” in an interview with Reuters.