Coinbase Files Request for Dismissal of Charges – Coinbase’s legal representatives have requested the dismissal of a lawsuit filed by the SEC, asserting that the regulator lacks the legal authority to pursue the case. The lawsuit was initiated by the SEC shortly after accusing the platform of facilitating unregistered trading with 12 tokens categorized as securities by the agency.
Coinbase’s legal team contends that six of the twelve cryptocurrencies were previously approved by the SEC in 2021 and were deemed not to be securities. During that time, the SEC reviewed 240 digital assets listed on the exchange. Coinbase argues that the current lawsuit stems from internal policy changes that were not adequately communicated to the companies the SEC intends to regulate, as the tokens in question had already been confirmed as non-securities by the SEC.
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“The SEC’s about-face is not a product of material changes to Coinbase’s business since 2021; none are alleged. Nor is it due to new information. Nowhere in its Complaint does the SEC suggest that Coinbase hid anything in the many years of cooperative discussion that preceded it becoming a public company. Nor is the reversal a product of legislative change. The only change is in the SEC’s position regarding its powers.”
Coinbase representatives have contended that the charges leveled against the company lack a solid foundation and go beyond the boundaries set by existing laws and regulatory precedents. Emphasizing their willingness to engage in discussions with regulatory bodies and adhere to clear legal frameworks, Coinbase’s leadership maintains that they operate within established guidelines.
Regarding the present case, Coinbase asserts that the tokens in question fall outside the SEC’s jurisdiction since the agency itself has acknowledged that they are not classified as securities. Even if the tokens were subject to the SEC’s oversight, Coinbase argues that the ongoing lawsuit violates the company’s rights and constitutes an abuse of the legal process.
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“Even if the SEC were correct that the assets and services it identifies are within the scope of its existing regulatory authority, this legal action must be dismissed on independent grounds that it violates Coinbase’s due process rights and constitutes an extraordinary abuse of process.” The request to dismiss charges is now pending with the judge, who will respond as he sees fit. Meanwhile, Coinbase’s stock seems to be slowly recovering following the initial shock that sent it plunging to the depths.
