The continuing legal dispute between oinbase">Coinbase and the U.S. has seen significant developments. The Securities and Exchange Commission (SEC) has filed a motion to dismiss the SEC’s complaint. With regard to the SEC’s assertion that some cryptocurrencies sold on its platforms are unregistered securities, oinbase">Coinbase contends that the digital assets listed on its platform are not subject to the regulator’s oversight.
Early in June, the Securities and Exchange Commission (SEC) sued oinbase">Coinbase, claiming that a dozen cryptocurrencies offered on the exchange’s wallets or trading platforms were unregistered securities. This argument is refuted by oinbase">Coinbase’s 177-page response, which was submitted on Thursday, June 29. It claims that since these cryptocurrencies are not investment contracts, they should not be classified as securities.
Cryptocurrencies traded on oinbase">Coinbase’s secondary market platform, according to the company, are not part of a deal in which a promoter sells an asset linked to a contract. The corporation justifies its stand by citing the Howey case from the Supreme Court.
oinbase">Coinbase argues in a court filing that transactions conducted for tokens on its secondary market platform are not securities, stating that the assets’ value is derived from themselves and their underlying companies are not factors and that issuers have no obligations to investors, contending that the SEC’s definition of “investment contract” is outside the statutory context and deviates from the Supreme Court and the Commission’s mutually agreed meaning.
oinbase">Coinbase also draws attention to the fact that SEC Chairman Gary Gensler has modified his opinion about the authority of the regulator over cryptocurrencies during his tenure. In addition, it draws attention to oinbase">Coinbase’s repeated requests for regulation. The proposal also mentions that Congress has started looking into the regulation of cryptocurrencies. Even if the SEC were right to claim its regulatory power over the aforementioned assets and services, the lawsuit must be dismissed, according to the petition to dismiss, because of alleged due process breaches and abuse of the legal system on the part of oinbase">Coinbase.
The exchange contends that the business sought advice from the SEC, adhered to some formal instructions provided by the SEC, senior SEC staff, and the courts regarding the application of securities laws to the cryptocurrency market, and voluntarily observed the regulations of numerous overlapping authorities.
oinbase">Coinbase claims that the SEC started the litigation in violation of its due process rights in a different document submitted to the superior court judge. According to the corporation, the SEC’s move is against the “major questions” doctrine: “Even were the proffered construction colorable, the major questions doctrine would counsel against its adoption by this Court and in favor of deference to Congress’s legislative prerogative to tackle for itself major policy decisions affecting substantial industry segments.”
With a seven-week timeframe for its motion, the SEC’s resistance, and its own answer to that opposition, oinbase">Coinbase is requesting the judge’s authorization to submit a motion for judgment.
According to Paul Grewal, oinbase">Coinbase’s chief legal officer (CLO), the company’s positions stated, “oinbase">Coinbase today filed our response and notice of intent to file a motion to dismiss the SEC proceeding against us. You can read our response for yourself – our arguments speak for themselves.”
He also stressed oinbase">Coinbase’s openness to communicating with any regulator, including the SEC, as well as its opinion that new rules and rulemaking are the best way to advance. He further emphasized that the lawsuit’s claims, which are illegal under current law, should be dropped.
As of now, the COIN share price was trading at $70.75, breaking through the 200-day EMA.
