A US court has ruled that the SEC can sue Coinbase, recognizing that the crypto exchange was engaged in the offer and sale of securities not registered under US law.

The war between Coinbase and the American stock market policeman (the SEC) is not over. This Wednesday, March 27, US federal judge Katherine Polk Failla ruled that Coinbase was engaged in the offer and sale of securities not registered under US law. The SEC is therefore entitled to file a lawsuit against Coinbase, which had made several requests aimed at avoiding such a scenario. Weakened, Coinbase shares fell more than 4.5% at the opening of the Nasdaq on Wednesday.

As a reminder, in June 2023, Coinbase had been assigned by the SEC for non-compliance with regulations, accusing it of not having registered as a cryptocurrency exchange platform. The SEC pointed out several breaches of basic prudential rules: no protection of investors in terms of fraud, manipulation, no standard procedure for monitoring transactions, no recourse in the event of litigation and no possibility for the SEC to carry out routine checks .

Finally, the American court considers that Coinbase’s staking program concerns unregistered “securities”.

“When a customer purchases a token on the Coinbase platform, they are not just purchasing a token, which in itself has no value, rather they are purchasing into the token’s digital ecosystem, whose growth is necessarily linked to the value of the token,” the judge said according to a document seen by CoinDesk.

The federal judge asked the two parties to reach an agreement by April 19. This decision does not seem to support the validation by the SEC of a spot ether ETF by May. As a reminder, the Ethereum blockchain operates on a so-called “proof of stake” system based on staking. A staking service is a loan of cryptocurrencies made to a blockchain against interest.

The price of bitcoin lost 2% in the space of an hour this Wednesday, falling below $70,000, while ether lost more than 3%.

Source: https://www.bfmtv.com/crypto/regulation/la-justice-americaine-permet-a-la-sec-d-attaquer-le-geant-des-cryptos-coinbase_AN-202403270648.html



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