Following an uncertain situation for months, the prominent crypto exchange Coinbase is taking a conclusive measure against the SEC’s Lawsuit. In this respect, the platform intends to dismiss the lawsuit that the United States Securities and Exchange Commission (SEC) filed against it. The US-based cryptocurrency exchange will release its conclusive plea to a federal judge for the dismissal of the respective lawsuit.
Coinbase’s New Filing Pushes the Court to Discharge SEC’s Lawsuit
The submission of the SEC lawsuit took place in June this year. As per a person acquainted with the issue, the reply brief of Coinbase will pay considerable attention to the case of the exchange. The response says that the SEC is infringing the chief questions doctrine. It keeps agencies from getting involved in the issues on which Congress has provided no ruling.
Judge Katherine Polk Faillas has the authority to immediately dismiss the respective case. A potential outcome of this deals with asking both parties to present arguments orally. In such a scenario, the case could get dismissed. On the other hand, it could step towarda summary judgment or a jury trial. The US securities regulatoraccused the crypto exchange of having facilitated unregistered securities trading.
SEC Accuses Coinbase of Having Provided Unregistered Offerings
Keeping that in view, the platform allegedly operated in the form of a registered firm offering brokerage and exchange services.The regulatory agency categorized thirteen digital coins among securities in its complaint. The respective tokens take into account Cardano’s ADA token and Solana’s SOL coin. In addition to this, the SEC also asserted that Coinbase provided and traded an unregistered security.
The SEC added that the crypto exchange carried out this through its staking project.With the respective program, the investors can stake 5 diverse coins. As per the SEC’s claims, all of the respective tokens comprise investment contracts. The crypto exchange submitted a court motion back in August. In it, Coinbase asked Failla to terminate the case. To support its argument, the crypto exchange said that the securities regulator infringed the due procedure.
It also added that the SEC abused its discretion by abandoning its distinctive earlier interpretations concerning the securities laws.Notably, the crypto exchange claimed that the SEC does not possess the authority to control Coinbase. According to it, digital assets do not come under the category of securities or investment contracts.
Coinbase Intends to Divert Attention from Serious Flaws in Its Legal Argents, Says SEC
The SEC, in line with the expectations, confronted this motion. It argued that, according to the Howey test, there was no expectation for investors in terms of gains, even in the absence of an official contract. On 3 October, in the SEC’s opposition filing, the agency mentioned that Coinbase was the culprit and tried to blame the agency to divert attention from the grave flaws in the legal arguments thereof.