So the SEC Just Beat Coinbase – What Do We Do Now?

Hey! Wake up and smell the legal documents because the SEC just scored a victory against Coinbase, and that's a huge blow to all of us. Yes. Sad day indeed. This historic decision could shake the very foundations of how crypto platforms operate in the United States.

Unpacking the legal document

So here's what happened.

The court rejected Coinbase's attempt to circumvent the SEC's allegations by effectively highlighting the platform's operations as an exchange, a broker, and a clearing agency. All of these securities come with strong regulatory expectations under US federal securities laws, and guess what? Coinbase has been doing its work without official approval from the SEC. Not to mention that their Stake Program is also involved in this mess, accused of offering and selling securities without registration.

But then! The court patted Coinbase on the back, dismissing the SEC's claims about the platform's 'wallet'.

Now, moving on. The SEC's dispute with Coinbase revolves around the platform that allows trades in crypto assets that are, for all intents and purposes, being sold as investment contracts, also known as securities. This includes a band of 13 crypto heavyweights such as SOL, ADA, ICP, NEAR, MATIC, FLOW and a few others making up the CryptoAssets list. Except for NEXO, which is in Wallet territory, all of these digital tokens are available to anyone who decides to jump on the Coinbase bandwagon. That sucks, doesn't it?

But the SEC didn't stop there. Oh no, they filed a whole buffet of complaints against Coinbase and pointed the finger at CGI, Coinbase's parent company, holding it responsible for failing to control these alleged securities law violations. And to top it off, the Coinbase Staking Program is under attack for allegedly offering and selling securities without the buzz.