• Coinbase has filed a response to the SEC’s lawsuit, claiming that the tokens mentioned in the complaint are not “investment contracts” and thus do not qualify as crypto asset securities.
• The SEC’s suit accused Coinbase of operating as an unregistered broker, national securities exchange, and clearing agency.
• Coinbase believes that the SEC is acting beyond its regulatory authority by attempting to expand its jurisdiction over digital assets.
Coinbase Responds to SEC Lawsuit
Coinbase has asked the court to dismiss the lawsuit filed against it by the US Securities and Exchange Commission (SEC), stating that the tokens mentioned in the lawsuit are not “investment contracts” and therefore do not qualify as crypto asset securities.
Details of SEC Lawsuit
In June, the SEC sued Coinbase for operating as an unregistered broker, national securities exchange, and clearing agency. The lawsuit also mentioned Coinbase’s staking program along with 13 tokens including DASH, NEXO, FLOW, SOL, and ADA, labeling them as securities.
SEC’s Actions Beyond Its Regulatory Authority
Meanwhile, Coinbase believes that the SEC has been acting beyond its regulatory authority by attempting to expand its jurisdiction over digital assets.
Coinbase’s Public Offering Request
The document claimed that Coinbase’s business remains unchanged since 2020 when it first requested to become a publicly traded firm via a direct public offering. As stated in the filing, six out of 12 crypto assets labeled by SEC as securities were already trading on platform when agency declared registration statement effective in 2021.
„Investment Contracts“ Not Satisfied By Tokens
„None of these satisfy Howey’s definition of an ‚investment contract‘ —the only type of ’security‘ which SEC says is at issue here,“ said Coinbasse in their response.