Welcome to HODL FM, where we unwrap crypto insights faster than Dudley with his birthday gifts.
Here is what we made for you:
- Big Win. Wallets are not brokers, U.S. Court rules.
- Coinbase is a broker and clearing agency, judge admits.
- SEC to proceed with Coinbase Legal Case.
The Illusion of Performance
Everyone loves a good suspense, especially one to do with bank robberies, supernatural stuff, and for most of us, a courtroom drama.
Suits. Htgawm. Marshal. Name them.
Nothing has more thrill than watching prosecutors bring the bad guys to justice. A random guy on Quora said the drama on TV is nothing like it in a real-world court setting. There are no attorneys, even as good as Harvey Spector to handle 36 cases in a day and go out for drinks/dinners. It’s the illusion of performance to think the good guys always win, or litigations involving multi-billion companies can be resolved in a day.
So when Judge Katherine Polk Failla refused to dismiss the SEC’s allegations against Coinbase, crypto proponents around the world knew the two entities’ extensive history of legal battles would continue beyond March 2024.
Only that this time, the SEC was also going to play defense at some point after Coinbase recently filed legal action against the commission for refusing to demonstrate its authority over the cryptocurrency industry by establishing regulations.
But for now, let’s talk about the Wins. Do you have your juice?
Coinbase Wallet is not a Broker
The crypto community is celebrating after a recent ruling by Judge Faill dismissed the SEC’s allegations against Coinbase Wallet. As per the judge, the commission did not provide any substantial proof about the exchange conducting brokerage services via its non-custodial wallet. As a result of the win, many believe it will set the stage for future cases against Decentralized Finance wallets which face similar accusations.
The Securities and Exchange Comission (SEC) had alleged that Coinbase Wallet by way of offering unregistered securities, its non-custodial wallet took part as an unregistered broker. However, the SEC found the claims to be insufficient and now DEFI platforms will have a reference when faced with similar accusations.
Nonetheless, Coinbase lost its bid whose goal was to dismiss the SEC case. This is despite Coinbase Wallet having secured a BIG WIN for the DeFi community.
We Were Prepared to Proceed with the Case
Paul Grewal, the Head of Legal Affairs at Coinbase said they had expected the SEC would get a green light to proceed with the case. Grewal posted the statement on X immediately after the Judge accepted the commission’s allegations that Coinbase was operating as a clearing agency, a broker, and an exchange.
The regulatory authority filed legal action against Coinbase in 2023 accusing the exchange of violating federal securities laws for supporting 13 illegal security tokens.
More Info:
- The U.S. Justice Department Charged Three Individuals For $400M FTX Hack
- FTX and Alameda Research Transfer $10.8M to Binance, Coinbase, and Wintermute
However, industry proponents see dismissal of Coinbase Wallet from the allegations as a significant setback for the commission in the future direction of the lawsuit. Many believe it’s just the beginning of Coinbase Exchange’s victory over the SEC, just like Ripple triumphed in 2023.
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