Court rules in favour of the SEC body, Coinbase lost the legal battle against the US SEC?
Finally, the court ruling came regarding the Coinbase vs SEC lawsuit over Coinbase’s motion and the ruling supported both parties but we can see that Coinbase lost in this phase.
Coinbase is the top crypto exchange of the US crypto market and also the services of this exchange are available globally via subsidiaries. In June 2023, this crypto exchange was sued by the United States Securities and Exchange Commission (SEC) for operating a national securities exchange without regulatory approval & offering unregistered securities tokens.
The SEC’s allegations, against the Coinbase crypto exchange, Coinbase acted as a broker to conduct buy & sell of unregistered security assets among people played a vital role in the latest court ruling. The court denied the exchange’s motion to dismiss Counts I, II, and III of the complaint, & supported SEC’s claims.
The court also found that CGI, the parent company behind the Coinbase crypto exchange, could be held liable as a control person of Coinbase under Section 20(a) of the Exchange Act. Regarding this matter, also the court sided with the SEC & denied Coinbase’s motion to dismiss Count IV.
Regarding the exchange’s Staking Program, the court ruling supported the SEC’s allegations that Coinbase voilated the Securities Act because Coinbase’s managerial efforts provided financial returns. In this matter, the court denied Coinbase’s motion for judgment on the pleadings.
Regarding the Coinbase Wallet application, the court ruling supported the Coinbase exchange. According to the SEC’s allegations, Coinbase exchange acted as a broker via Coinbase wallet services but the court ruling denied these allegations in the absence of sufficient support.
The court ordered both parties involved in the case to submit a proposed plan for managing the case to the court by April 19, 2024.
This latest court ruling doesn’t mean that the SEC’s charges proved against Coinbase. This is the court’s fundamental view on this case on behalf of traditional financial laws and now the actual battle will start with facts & evidence.
Following this court ruling in this case, former government secret agent & Bitcoin supporter Edward Snowden said that if the SEC body will continuously do such works blindly then surely the SEC body would lose badly in the future.
Edward also dragged attention toward approval of Bitcoin spot ETF products, which was looking impossible but still, the SEC chairman Gary Gensler supported & approved under pressure.
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