In a recent development, Coinbase moves to dismiss the complaint brought against the company was met with a statement from the United States Securities and Exchange Commission (SEC). The American cryptocurrency giant may have intentionally broken securities rules, according to the SEC. The response challenges Coinbase’s justifications and requests denial of the exchange’s motion to dismiss. It is addressed to US District Judge Katherine Polk Failla in the Manhattan Federal Court.
In its filing, the SEC refutes Coinbase’s assertion that the legitimacy of its cryptocurrency listings is unregulated by federal securities laws. The regulator asserts that Coinbase, as a multibillion-dollar company with legal counsel, was fully aware of the applicability of federal securities rules to its cryptocurrency listings. The claim emphasizes Coinbase’s understanding and resources in the matter. The response highlights Coinbase’s possession of the necessary knowledge to evaluate the legality of its actions. Despite the potential risks, the exchange deliberately chose to pursue business growth.
The SEC dismisses Coinbase’s claim that an IPO approval provides protection against future enforcement actions. The regulator rejects this argument made by the exchange. The regulator argues that even with the IPO approval, Coinbase remains susceptible to securities rules violations. The approval does not absolve the exchange from compliance.
The SEC highlighted Coinbase’s admission of risk for investors in earlier court papers. The exchange acknowledged the uncertainty surrounding the security status of tokens on its platform. The SEC argues that Coinbase’s acknowledgment demonstrates its awareness of the applicability of securities laws. Despite this, the exchange proceeded with its operations.
SEC Responds to Coinbase Lawsuit, Questions Arguments and Seeks Dismissal
The regulator finds Coinbase’s arguments weak as it accuses the exchange of adopting a legal framework for listing choices while simultaneously arguing that such requirements did not apply to its operations. The SEC opposes any petition for judgment that the cryptocurrency exchange may submit and wants the court to dismiss Coinbase’s justifications.
The SEC’s response highlights the organization’s dedication to upholding securities regulations in the quickly developing cryptocurrency sector. The lawsuit’s outcome will likely influence cryptocurrency regulation in the United States. It carries implications for the industry’s regulatory landscape.
The decision of Judge Katherine Polk Failla on Coinbase’s move to dismiss the complaint is still pending. Market participants and regulatory agencies will closely monitor the outcome of the court case. They seek clarity on legal obligations for cryptocurrency exchanges and potential impacts on the industry. The judicial proceedings will surely get a lot of attention.