Coinbase has asked the U.S. Court of Appeals to rule that the trading of crypto assets on its platform are not securities transactions, but asset sales. The company made this request in a petition to the court as part of an appeal tied to a Securities and Exchange Commission lawsuit filed in 2023. The lawsuit alleges that Coinbase operated as an unregistered securities broker.
Coinbase claims that trades on its platform are not securities transactions because buyers do not obtain rights against the asset’s issuer, similar to stocks and bonds. The company believes a ruling on this question will clear up uncertainty in the cryptocurrency market.
The SEC sued Coinbase in June 2023, claiming the platform allowed users to trade unregistered securities. The lawsuit was filed after the SEC claimed Coinbase ignored rules and regulations.
The SEC has been criticized for not providing clear regulatory guidance for the digital asset industry. Instead, the agency has been using an enforcement-only approach, which has been damaging to American consumers and innovation.
Recently, the SEC launched a crypto task force to develop a clear regulatory framework for crypto assets. The task force is led by Acting Chairman Mark T. Uyeda and aims to provide clarity for the industry.
Coinbase has been seeking clarity on regulations for the digital asset industry. The company believes that regulation by enforcement is damaging to the industry and consumers. Coinbase is determined to get clarity for the industry and the millions of Americans who hold crypto.
The outcome of the appeal is expected to have a significant impact on the cryptocurrency market. If the court rules in favor of Coinbase, it could provide clarity on the regulatory status of crypto assets. However, if the court rules against Coinbase, it could lead to increased regulatory scrutiny for the industry.
