Coinbase Takes On SEC In Court: A Turning Point For Crypto?

Coinbase Global Inc COIN is set to contest the U.S. Securities and Exchange Commission’s (SEC) classification of tokens traded on its platform as securities.

What Happened: Coinbase, the world’s largest publicly traded cryptocurrency exchange, is scheduled to present its case in a federal court on Wednesday, as reported by Reuters. The exchange will argue that the tokens it facilitates trading for are not securities and, therefore, should not be under the SEC’s jurisdiction.

The SEC filed a lawsuit against Coinbase in June, alleging that the exchange was illegally operating as a national securities exchange, broker, and clearing agency. The SEC also targeted Coinbase’s “staking” program, which it claimed should have been registered with the agency.

Coinbase’s argument is expected to center around the assertion that crypto assets are fundamentally different from traditional securities and should not be subject to the same regulatory oversight.

See Also: Bitcoin, Ethereum, Dogecoin Rise As Investors Weigh Spot ETF Impact: Analyst Says Scenario For King Crypto Is ‘Rejection’ At $46K And Then Correction To Below $40K

Why It Matters: The outcome of this legal battle could have far-reaching implications for the entire digital asset sector. The SEC has been increasingly targeting the crypto industry, with a particular focus on companies offering trading platforms and clearing activity.

Earlier in January, the SEC used a favorable judgment in its case against Terraform Labs to strengthen its legal battles with major cryptocurrency exchanges, including Coinbase. The judgment concluded that certain tokens are indeed securities, a ruling that the SEC is now using as a precedent in its ongoing cases.

Despite the legal challenges, Coinbase’s CEO, Brian Armstrong, has remained steadfast in his commitment to the U.S. market. He has even suggested that a change in SEC leadership could potentially help resolve the ongoing dispute.

Photo by rafapress on Shutterstock

Read NextJim Cramer Advises Against Using Binance, Provokes Strong Reactions From Twitter Users


Engineered by Benzinga Neuro, Edited by Pooja Rajkumari


The GPT-4-based Benzinga Neuro content generation system exploits the extensive Benzinga Ecosystem, including native data, APIs, and more to create comprehensive and timely stories for you. Learn more.


Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Posted In: CryptocurrencyNewsMarketsGeneralCoinbasecrypto regulationPooja RajkumariSecurities and Exchange Commission (SEC)Stories That Matter
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!