United

Test

when

April

Coinbase, one of the largest cryptocurrency exchanges in the United States, has escalated its legal battle against the US Securities and Exchange Commission (SEC) with a new court filing.
On May 24, Coinbase <a href="https://assets.ctfassets.net/sygt3q11s4a9/5jEAsvCE3W61n9TSvZgHwL/aa1f286f3afb6f02045da78765250504/2024.05.24_-_Dkt._128_-_Reply_in_Supp._of_Cert..pdf" rel="noopener noreferrer nofollow">submitted</a> a memorandum in support of its interlocutory appeal, challenging the SEC’s stance on the application of the Howey test, a critical framework for determining whether certain transactions qualify as investment contracts.
<h2 id="span-style-font-weight-400-dispute-around-the-coinbase-staking-program-span">Dispute Around the Coinbase Staking Program</h2>
The dispute centers around Coinbase’s staking program, which the <a href="https://thecoinrise.com/sec-opposes-coinbases-interlocutory-appeal-details/" rel="noopener noreferrer nofollow">SEC claims constitutes an unregistered securities offering</a>. This legal contention has been ongoing since March 27, when the court ruled that the SEC had sufficient grounds to argue its case.&nbsp;
In response, Coinbase filed for an interlocutory appeal on April 12, disputing the court’s decision and seeking clarity on a fundamental legal question: does the definition of an investment contract under the Howey test require a post-sale contractual undertaking?
<h3 id="span-style-font-weight-400-the-sec-is-attempting-to-sidestep-the-howey-test-span">The SEC is Attempting to Sidestep the Howey Test</h3>
The Coinbase memorandum argues that no appellate court in the 78 years since the Howey decision has ever found an investment contract without a post-sale contractual obligation. This, according to Coinbase, makes the issue a matter of legal interpretation rather than the straightforward application of established law.&nbsp;
The company’s legal team <a href="https://x.com/iampaulgrewal/status/1793991568824971295" rel="noopener noreferrer nofollow">asserts</a> that the SEC is attempting to sidestep the Howey test, a claim that highlights the broader implications of this case for the cryptocurrency industry.
“The SEC ignores that no appellate court in the 78 years since Howey has found an investment contract absent a post-sale contractual undertaking,” Coinbase stated in its filing. The exchange contends that this lack of precedent makes the case ripe for judicial clarification.
<h2 id="span-style-font-weight-400-the-sec-s-inconsistent-approach-span">The SEC’s Inconsistent Approach</h2>
Moreover, Coinbase pointed to inconsistencies in the SEC’s approach, noting differences between the regulator’s arguments in this case and its claims in the ongoing lawsuit against Ripple.&nbsp;
The memorandum also referenced recent legislative developments, such as the House of Representatives passing a bill that would limit the SEC’s jurisdiction over cryptocurrencies, arguing that these actions reflect broader <a href="https://thecoinrise.com/cftc-chair-warns-of-more-regulatory-crackdowns-on-crypto-firms/" rel="noopener noreferrer nofollow">uncertainties about the regulatory framework</a> for digital assets.
<h3 id="span-style-font-weight-400-sec-vs-coinbase-span">SEC vs. Coinbase</h3>
The SEC’s lawsuit against Coinbase, filed in June 2023, alleges multiple violations of securities law. In addition to the staking program issue, the SEC claims that 13 of the cryptocurrencies listed on Coinbase are securities. This case is part of a larger regulatory crackdown on the cryptocurrency industry, as the <a href="https://thecoinrise.com/sec-opposed-coinbase-petition-on-new-regulatory-framework/" rel="noopener noreferrer nofollow">SEC seeks to establish clearer guidelines</a> for the classification and regulation of digital assets.
In its defense, Coinbase has been proactive, not only in the courtroom but also in the public sphere. Shortly after the SEC filed its lawsuit, Coinbase launched the “Stand With Crypto” campaign, which includes a political action committee aimed at advocating for favorable cryptocurrency regulations.
The post <a href="https://thecoinrise.com/coinbase-challenges-sec-in-court-a-legal-battle-over-staking/" rel="noopener noreferrer nofollow">Coinbase Challenges SEC in Court: A Legal Battle Over Staking</a> appeared first on <a href="https://thecoinrise.com" rel="noopener noreferrer nofollow">Latest News and Insights on Blockchain, Cryptocurrency, and Investing</a>.

Coinbase Challenges SEC in Court: A Legal Battle Over Staking

Table of Contents

TheCoinrise Media

Other articles published on May 25, 2024

Major Analyst Crypto Tony Bullish on These Meme Coins, But One Stands Out

Ripple Faces Criticism Over Tether Remarks

Bitcoin ETF Inflows Spike Again, BlackRocks Leads Scooping $182 Million

Bybit to List zkSync & Change the Ticker: How the Community Reacts?

Lido DAO Sees Significant Price Increase

New Meme Coin $DOGEVERSE Ends Presale June 3rd – Invest Before It Sells Out

Join our free newsletter for daily crypto updates!