Coinbase, one of the biggest crypto exchanges in the industry, is expected to file a final lawsuit on Tuesday against the U.S. Securities and Exchange Commission, arguing that its case should be dropped. The SEC is filing a suit against the exchange for violations of unregistered securities.
An insider source from Coinbase hinted that the exchange would charge more for filing its arguments. They also claim that the SEC is violating the major doctrines that hold that federal agencies have no right to regulate areas that are still awaiting Congress' action.
The verdict has been held pending until Coinbase files its rebuttal. Only then will Judge Katherine Polk Failla of the U.S. District Court be able to make a concluding statement when both sides give their full arguments.
Already, it's been speculated that the judge has noticed some imbalance in the arguments given by the SEC and is waiting to see if Coinbase will give a counter argument. If they decide to give an argument enough to convince the judge, she will be able to dismiss the case.
In order to get an early judgment on this case, Coinbase argued that the SEC is not authorized to make certain claims. They also claim that the Howey test, which the agency talked about, which is said to legally determine the security of certain things, is flexible and can be interpreted in any way. They maintain that this is not supposed to be a factual test for the agency to charge them.
The SEC has suffered a series of court setbacks that have demonstrated the federal judges in its multi-front battle against the crypto industry aren't rushing to show the agency deference.
The SEC's foundation that virtually all cryptocurrencies are securities and that unregistered companies trafficking in them are breaking securities law has developed significant cracks, most notably in the Ripple ruling that said that company didn't violate the law in selling its affiliated XRP cryptocurrency to retail customers.
The battle between the SEC and Coinbase did not just begin now as they already had a previous case in court. Coinbase sued the SEC early in April in order to request the agency to give answers to its petition concerning the issues related to crypto exchanges.
It is speculated that the case may also be coming to an end, because the SEC told that court that its staff made a recommendation on October 10 to a five-member commission on how to handle the petition laid out by Coinbase.
As Coinbase prepares to make its final argument against the U.S. Securities and Exchange Commission's (SEC) accusations of unregistered securities, the crypto industry eagerly awaits the outcome of this high-stakes legal battle.
With Coinbase challenging the SEC's authority and interpretation of the Howey test, the verdict remains pending, and all eyes are on Judge Katherine Polk Failla's decision. This case represents a significant milestone in the ongoing tussle between regulators and the cryptocurrency industry.
While the SEC has faced setbacks in its pursuit of treating most cryptocurrencies as securities, this battle underscores the broader debate around crypto regulations in the United States. As the final arguments are presented, the crypto community will be closely monitoring the outcome and its potential implications for the industry as a whole.
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