Tag: Coinbase

Crypto Has ‘No Innate or Inherent Value’, SEC Argues in Coinbase Case

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By Nicholas Morgan. (Decrypt). October 8, 2023.

The Securities and Exchange Commission is arguing that cryptocurrencies lack any “innate or inherent value” as part of their case against Coinbase in federal court—prompting eye rolls from Coinbase and crypto watchers.

In response to a motion to throw out the agency’s lawsuit filed over the summer, the SEC petitioned a judge to reject Coinbase’s stance that cryptocurrency trading does not count as an investment contract between parties. It justified its position by repeating its position that federal securities laws are designed to be interpreted flexibly through the legal doctrine known as the “Howey Test.”

Read the full piece from Decrypt here: “Crypto Has ‘No Innate or Inherent Value’, SEC Argues in Coinbase Case“

US SEC asks judge to deny Coinbase motion to dismiss its lawsuit

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By Hannah Lang and Chris Prentice. (Reuters). October 3, 2023.

The U.S. Securities and Exchange Commission (SEC) on Tuesday asked a federal judge to deny a motion from Coinbase Global (COIN.O) to dismiss the regulator’s lawsuit against the cryptocurrency exchange.

The agency said Coinbase was wrong to rely on a recent court ruling that found cryptocurrency developer Ripple Labs Inc did not violate federal securities law by selling its XRP token on public exchanges, citing a subsequent ruling in the case of Terraform Labs that rejected the court’s reasoning.

Tuesday’s filing showed that the SEC is seizing on the Terraform Labs ruling to raise questions about the ruling in the Ripple case, which the crypto industry had hailed as a victory.

Read the full piece from Reuters here: “US SEC asks judge to deny Coinbase motion to dismiss its lawsuit“

Coinbase wins approval to offer crypto futures trading in US

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By Reuters Staff. (Reuters). August 16, 2023.

Coinbase Global (COIN.O) said on Wednesday it had secured approval to offer cryptocurrency futures to U.S. retail customers, scoring a major regulatory win even as the crypto exchange battles a lawsuit from the Securities and Exchange Commission (SEC).

Shares of the company climbed 5.5% to $83.52 in premarket trading. The approval was granted by the National Futures Association (NFA), a self-regulatory organization designated by the Commodity Futures Trading Commission (CFTC).

“This is a critical milestone that reaffirms our commitment to operate a regulated and compliant business,” Coinbase said.

The company has openly criticized the SEC, which in a June lawsuit accused Coinbase of operating illegally because it had failed to register as an exchange.

CEO Brian Armstrong has also said more U.S. crypto companies could move offshore due to a hostile regulatory environment and that SEC Chair Gary Gensler’s enforcement-first approach could stifle innovation in the industry.

Read the full article here.

How The SEC’s Charge That Cryptos Are Securities Could Face An Uphill Battle

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By Maria Gracia Santillana Linares. (Forbes). August 14, 2023.

As the smoke clears from the first exchange of volleys between the Securities and Exchange Commission and the world’s two largest cryptocurrency exchanges, Binance and Coinbase appear to have run out high-caliber legal arguments in their defense.

The U.S. regulator sued the two companies in June, alleging they were operating as unregistered securities exchanges and facilitating trading in cryptocurrencies that should have been registered as securities. The agency has been staunch in its contention that most digital assets–except for bitcoin and possibly ether–are securities and subject to its oversight as are exchanges on which cryptocurrencies trade.

Binance and Coinbase beg to differ, and they offer several arguments. The most potent, according to lawyers following the case, has to do with whether cryptocurrencies are meant to provide their owners with profit derived from the labors of others. If they do not meet that definition, then they are not securities. That might be enough to torpedo the government’s civil suits against the exchanges or at least narrow the scope of which of the 19 tokens it cited in the actions really are any of the SEC’s business.

Read the full article here.

Coinbase Will Relist XRP Following Ripple Summary Judgment

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By Katherine Ross. July 13, 2023. (Blockworks).

Coinbase will re-enable trading for XRP following a Thursday court ruling. 

A U.S. District Judge, Analisa Torres, ruled that Ripple’s XRP is not a security when traded on secondary exchanges, even if its institutional sales do meet that definition — handing Ripple partial victory in a case that dates back to 2020. 

Following the ruling’s release, Coinbase chief legal officer Paul Grewal tweeted that “it’s time to relist” XRP.

Read the Full Article Here.

SEC’s Coinbase Fight Puts Exchange, Crypto Survival on the Line

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By David Jolly. March 27, 2023. (Bloomberg Law).

The SEC’s decision to target Coinbase Global Inc. for enforcement actions sets the stage for a protracted legal battle that threatens the top US crypto exchange and potentially the entire US digital assets sector, legal and industry analysts say.

Coinbase revealed last week that the Securities and Exchange Commission had served it with a Wells Notice, a notification that the agency is planning to recommend enforcement action for alleged securities law violations. Already reeling from its increasing exclusion from the traditional financial system, the US crypto industry sees the Coinbase action as a signal that the SEC—and its determined chairman, Gary Gensler—intend to regulate the industry out of business.

“It is hard to look at what’s happening at the federal regulatory level and not see it’s an existential threat,” said Sheila Warren, CEO of the Crypto Council for Innovation. “Between challenges around obtaining basic banking services, making payroll, to open hostility from this SEC, operating in the US is not for the faint of heart.”

Read the full article here.

The Crypto Security Debate Goes to Court

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By Paul Kiernan. May 26, 2022. (Wall Street Journal)

WASHINGTON—Investors are asking the courts to decide an existential question for the cryptocurrency industry: whether digital tokens are, for legal purposes, more similar to stocks or to gold.

Attorneys for cryptocurrency-trading platform Coinbase Global Inc. COIN 9.47% filed a motion this month to dismiss a class-action lawsuit arguing that 79 of the tokens listed on the firm’s platform are unregistered securities. 

The group of Coinbase users is demanding reimbursement for trading fees and market losses and seeking to prevent the assets from continuing to trade on the platform. 

Outside of enforcement actions, the Securities and Exchange Commission hasn’t indicated which cryptocurrencies it considers to be securities. But federal statutes passed in the 1930s deputize ordinary investors to help the SEC do its job, by giving buyers of unregistered securities the right to sue the seller for their money back. 

Read the full article here.

Crypto executives urge light touch as Congress mulls new regulation

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By Pete Schroeder and Katanga Johnson. December 8, 2021. (Reuters).

WASHINGTON – Top executives from six major cryptocurrency companies including Coinbase and Circle on Wednesday urged Congress to provide clearer rules for the booming $3 trillion industry, but warned that overly tough restrictions would push it overseas.

The U.S. House of Representatives Financial Services Committee hearing marked the first time the industry’s senior leaders have explained their businesses to U.S. lawmakers amid growing concerns cryptocurrencies may pose systemic risks and hurt investors.

Crypto executives repeated calls for careful, bespoke rules rather than forcing the industry to comply with existing regulations.

Read the Full Article Here.

Waging War on Cryptocurrency Would Be a Mistake for Democrats

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By Former Rep. Albert Wynn (D-MD). November 30, 2021. (Bloomberg Law).

When innovation brings change to an industry, the government’s role is to observe first and then manage the change as necessary. The government should not be an obstacle to progress. The Democratic Party has long been a champion of inclusionary innovation, smoothing the disruption to families and workers while spreading the benefits as widely as possible throughout the economy.

I fear, however, that with the fintech revolution rising through decentralized finance and blockchain technology, some in our party are mobilizing for a war on cryptocurrencies that could be futile and economically costly to the country.

There is wide agreement that regulation is needed for digital assets. There must be strict protections against money laundering and fraud in coin offerings and the financial products emerging in this $2 trillion asset space.

Read the Full Article Here.

Still-young crypto industry could grow stronger — if SEC allows it to thrive

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By Charles Gasparino. September 19, 2021. (New York Post).

The noise surrounding the $2.2 trillion crypto industry often drowns out the reality that we are on the verge of something revolutionary. If things go right, crypto and the blockchain technology could usher in the next Internet revolution. 

Things are now going terribly wrong. The US stands the very real chance of killing this business here by driving digital innovation overseas and ceding advancements to other countries including Communist China.

Why? Because our regulators, mainly those at the Securities and Exchange Commission, are either too feckless or too turf-hungry (or a combination of both) to understand the dangers of their asinine approach to overseeing a nascent and important technology.

Read the Full Article Here.