Coinbase Shares Dwindle as SEC Lawsuit Moves Forward

By: Eva Baxter

The ongoing legal dispute between Coinbase and the US Securities and Exchange Commission (SEC) took a major turn as the court decided to allow the case to proceed. Paul Grewal, Coinbase's Chief Legal Officer, said the company was prepared for the development, as he shared on Twitter. Resulting from the news, Coinbase's shares have seen a dip of more than 3% to $260, as per Yahoo Finance.

The court had ruled that Coinbase was operating as an exchange, a broker, and a clearing agency under federal securities laws and had sold unregistered securities through its staking program. Nevertheless, the SEC’s claim that Coinbase acted as an unregistered broker via its Wallet application was dismissed by the Judge.

This lawsuit was launched by the SEC alleging the violation of federal securities laws by Coinbase, where it facilitated trading of at least 13 crypto securities tokens. Despite the unfavorable ruling, some crypto stakeholders remained unfazed, undermining the significance of the development. Yet, the unfolding of further course of this legal battle remains crucial for the company's reputation and the crypto sector's regulatory landscape at large.