Coinbase Sued for Allegedly Selling 79 Unregistered Crypto Securities – A class-action lawsuit has been issued against Coinbase, a Nasdaq-listed cryptocurrency exchange, alleging that the platform allows consumers to trade 79 unregistered coins, including XRP, shiba inu (SHIB), dogecoin (DOGE).
Christopher Underwood, Louis Oberlander, Henry Rodriguez, lead plaintiffs, claim that from October 8, 2019, to the present, Coinbase allowed customers to acquire and sell 79 different cryptocurrencies without stating that they were securities.
According to the plaintiffs, these crypto securities aren’t registered with the US Securities and Exchange Commission (SEC) or any state agencies, and Coinbase is not a securities exchange or broker-dealer.
“Coinbase’s sale of these tokens breaches both federal and state law,” the plaintiffs argue. During the class period, anyone who transacted any of the 79 crypto assets on Coinbase or the Coinbase Pro platform was covered.
The plaintiffs claimed that without registering these digital assets with the SEC and state regulators:
“Purchasers do not have access to the disclosures that traditionally accompany securities issuances. Rather, investors receive merely the so-called whitepapers that describe the token but do not meet the federal and state securities laws’ criteria for a prospectus.”
The 79 cryptocurrencies named in the lawsuit are 1INCH, CTSI, CVC, DNT, DOGE, DOT, ENJ, EOS, FARM, FET, FIL, FORTH, GNT, GRT, GTC, ICP, AAVE, ACH, ADA, AGLD, OMG, ORN, OXT, PLA, POLY, SHIB, ALGO, AMP, ANKR, ARPA, ATOM, AUCTION, AXS, BAL, BAND, BAT, BNT, BOND, BTRST, CGLD, CLV, COMP, CRO, CRV, IOTX, KEEP, KNC, LINK, LOOM, LRC, MANA, MATIC, MKR, MLN, NKN, NMR, NU, OGN, SKL, SNX, SOL, STORJ, SUSHI, TRB, TRIBE, UMA, UNI, XLM, XRP, XTZ, XYO, YFI, ZRX QNT, QUICK, RARI, REN, REP, RLC.
SEC Chairman Gary Gensler is mentioned several times in the lawsuit. The SEC chairman has stated on multiple occasions that the crypto sector lacks adequate investor protection. He pointed out that some other platforms feature 50 to 100 tokens, with some possibly being securities.
The SEC, on the other hand, has been quiet about which cryptocurrencies it deems securities. The Commission sued Ripple Labs and two executives in December 2000 over the sale of XRP, which it claimed was unregistered securities. Although the case is currently ongoing, Ripple maintains that XRP is not a security.
Coinbase has launched a class-action lawsuit alleging the following:
“This is a class action case in which all members of the proposed classes have claims totaling more than $5 million, minus interest and fees.”
The plaintiffs want “to recover damages, consideration paid for tokens, and trading fees, including with interest thereon, as well as attorneys’ fees and costs, to the utmost degree permissible by law.”