Cryptocurrencies

Coinbase Bolsters Argument for Interlocutory Appeal in Latest Filing

The ongoing legal battle between Coinbase and the US Securities and Exchange Commission (SEC) is taking unexpected turns in what could be a significant case in crypto regulatory history. In a recent update, the American crypto exchange has responded to the commission’s petition against an initial motion for an interlocutory appeal in this contentious legal dispute.

Coinbase Fires Back at SEC in Appeal Process
On April 12, Coinbase sought clarification from the US court on whether an investment contract can be established without post-sale obligations, considering it a crucial legal question in the case with the SEC. The SEC, on the other hand, argued against certifying the interlocutory appeal, citing the long-standing effectiveness of existing securities regulations like the Howey Test. Coinbase’s latest Memorandum of Law emphasizes the novel issue of whether a digital asset transaction without post-sale obligations can constitute an investment contract under Howey.

Coinbase Aims for Legal Victory
In its latest petition, Coinbase underlines the potential significance of the interlocutory appeal on its case with the SEC, stating that a favorable outcome could invalidate a majority of SEC complaints. A statement from the petition highlights the focus on Coinbase’s platform and services rather than unrelated issues, which could lead to substantial judicial resources being consumed if not addressed through interlocutory review.

The current total crypto market cap is $2.492 trillion | Source: TOTAL chart on Tradingview.com
On June 6, 2023, the SEC accused Coinbase of operating as an unlicensed securities exchange, broker, and clearing agency, which could have significant implications for the regulation of the crypto industry in the US, given Coinbase’s prominent position as the largest US exchange.

Featured image from Yahoo Finance, chart from Tradingview

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