Court Rules SEC Can Proceed with Lawsuit Against Coinbase
A federal judge in Manhattan has ruled that the lawsuit brought by the Securities and Exchange Commission (SEC) against Coinbase, the largest U.S. cryptocurrency exchange, may continue. The SEC's suit, filed in June 2023, contends that Coinbase operated as an unregistered exchange, broker, and clearing agency and that it engaged in the unregistered offer and sale of at least 13 crypto tokens, which the SEC alleges should have been registered as securities.
While the lawsuit will move forward, the court dismissed the SEC's claim that Coinbase operated as an unregistered broker through its wallet application, representing a partial victory for Coinbase. Following the court's decision, shares of Coinbase fell by 2%, and the price of Bitcoin also experienced a 1% decline.
The outcome of this case is being closely watched as it could set a precedent for the application of U.S. securities law to digital asset companies. The case is expected to be finalized in court in March 2024.
