Fintech
Coinbase Fights SEC: Seeks Crucial Answer That Could Transform Cryptocurrencies
Cryptocurrency exchange Coinbase has responded to SEC comments on its request for an interlocutory appeal. Coinbase is asking the SEC to clarify whether digital asset transactions with no obligations to the original issuer qualify as investment contracts under SEC regulations.
Coinbase presented an expert response
On May 24th, Coinbase filed a memorandum supporting your appeal of a specific ruling in an ongoing case with the SEC. This filing responds to the SEC’s opposition to Coinbase’s initial appeal request.
Initially Coinbase has appealed on April 12, challenging a March 27 ruling that the SEC had sufficient grounds to argue that Coinbase’s staking program was an unregistered securities offering.
The main one of Coinbase argument on appeal is that the key question is whether an investment contract requires a contractual commitment. Coinbase argues that under SEC regulations, digital asset transactions without post-sale obligations to the original issuer should not be considered investment contracts.
The SEC, opposing Coinbase’s appeal, argues that no court has required a post-sale contractual commitment to apply the Howey test, which determines what constitutes a security.
The SEC takes!!!
The SEC, opposing Coinbase’s appeal, argues that no court has required a post-sale contractual commitment to apply the Howey test, which determines what constitutes a security.
Furthermore, the SEC argued that Coinbase’s request lacks legal merit. The commission maintains that the court has already rejected Coinbase’s arguments and that even the latest appeal request does not provide sufficient legal basis. The SEC maintains that there is no question that the complaint should be dismissed.
Potential impact on the sector
The outcome could influence other SEC actions in the cryptocurrency sector. Because the courts, including Judge Katherine Polk Failla, will decide whether the appeal can proceed.
However, he previously denied Coinbase’s request to dismiss the SEC’s original case. Meanwhile, the resolution of this case could set a precedent that will shape the future of digital asset regulation.