According to media speculations from earlier this week, renowned digital currency trading platform Coinbase Global inc has filed a new motion as it seeks to quash the securities lawsuit brought on by the United States Securities and Exchange Commission (SEC).
The company’s chief legal officer (CLO) Paul Grewal revealed this filing through his official Twitter handle and noted that the firm does not offer 'investment contracts,' as alleged by the regulator.
Today, @coinbase filed our brief asking the Court to dismiss the SEC’s case against us. Our core argument is simple — we do not offer "investment contracts" as that term has been construed by decades of Supreme Court and other binding precedent. 1/3 https://t.co/r2EkDgkEuc— paulgrewal.eth (@iampaulgrewal) August 4, 2023
Abiding by bold claims
The Coinbase legal brawl with the SEC is one of many enforcement actions that have been initiated by the latter thus far this year as the regulator seeks to stamp out every form of investment contract being offered by crypto firms operating in the United States.
While its approach has stirred mixed reactions, Grewal categorically stated that the SEC has ignored a very crucial precedent in which the Supreme Court has construed over the years what binds an agreement to be an investment contract. By ignoring this precedent, Grewal said the market regulator:
...has violated due process, abused its discretion, and abandoned its own earlier interpretations of the securities laws. By ignoring that precedent, the SEC has trampled the strict boundaries on its basic authority set by Congress.
The trading platform has always been confident in its ability to win the securities lawsuit brought on by the SEC, and this filing for dismissal is yet another proactive way it is going on the offensive.
XRP-like win underway?
Just a few weeks ago, blockchain payments firm Ripple Labs Inc scored a crucial win against the SEC as Judge Analisa Torres declared that XRP is not in itself a security. With the SEC's wounds still fresh, there is now ongoing speculation that Coinbase may be able to pull off a related win, given how its lawsuit is currently shaping up.