Amid the joint motion between crypto exchange Binance and the U.S. Securities and Exchange Commission (SEC), all eyes are on the SEC’s response to Coinbase’s intermediate appeal, as this could mark a turning point for future crypto litigations surrounding securities.
SEC’s Deadline to Respond to Coinbase on Feb 14
According to Fox News journalist Eleanor Terrett, Coinbase finds itself in a special position as it remains surrounded by allegations of illegally selling securities. These allegations not only come from the SEC but also follow a recent ruling by a New York court. Terrett shared her views, saying, “Coinbase’s lawsuit was officially ‘halted’ last month when Judge Failla granted the company permission to file an interlocutory appeal to resolve at the Second Circuit whether existing securities laws apply to digital assets traded on Coinbase’s platform.”
🚨NEW: So @coinbase is in a unique situation compared to other #crypto firms currently in litigation.
Their lawsuit was officially ‘halted’ last month when Judge Failla granted the company permission to leave to file an interlocutory appeal to resolve at the Second Circuit… https://t.co/qWZWyL54yy
— Eleanor Terrett (@EleanorTerrett) February 12, 2025
It is important to note that February 14 has been set as the SEC’s deadline to respond to Coinbase’s request to file the appeal.
Terrett outlined four possible responses from the SEC. First, the SEC could oppose Coinbase’s request for appeal, “which would suggest that the SEC, under acting chair Mark Uyeda, still plans to argue, just as former chair Gary Gensler did, that securities laws clearly apply to most crypto tokens.” Uyeda and SEC Commissioner Hester Peirce have both stated that the law in this area has not been clear.
Another possibility is that the SEC would not oppose Coinbase’s request for appeal, which would indicate that the SEC wants to resolve the issue of how securities laws apply to crypto. This matter is currently being addressed by the SEC’s crypto task force, according to Commissioner Peirce, who confirmed that the SEC is reassessing past legal actions against crypto firms and exploring alternative regulatory approaches.
A third possibility is that the SEC could simply request an extension of the deadline. Lastly, the SEC might decide not to proceed and drop the case altogether.
Amid the SEC’s impending response, Judge Paul Engelmayer of the U.S. District Court in Manhattan recently rejected Coinbase’s argument that it was not a “statutory seller” under federal securities laws in a separate case against the crypto exchange.Therefore, with SEC’s deadline to respond to Coinbase approaching, a key precedent could be set for how regulatory bodies seek to define securities.
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Source: https://www.cryptonewsz.com/secs-coinbase-a-precedent-crypto-securities/