The United States Securities and Exchange Commission (SEC) has just received much-needed support from the North American Securities Administrators Association (NASAA), which is now acting as an amicus curiae in its legal fight against top crypto exchange Coinbase Global Inc.
The body filed its support arguing that digital assets that are at the core of the regulatory crackdown should not be treated as "somehow special." The body also argues that the enforcement action should not be considered "novel or extraordinary" because a digital currency trading platform is involved.
At the core of the SEC and Coinbase dispute is the allegation that the latter is supporting a list of digital currencies that are deemed unregistered securities. Some of the tokens labeled by the regulator include, but are not limited to, Cardano (ADA), Solana (SOL) and Filecoin (FIL).
In its support for the SEC, NASAA said as far as securities laws are concerned, there should be no preferential treatment.
"The SEC's theory in this case is consistent with the agency’s longstanding public position [...] It is also well within the bounds of established law," the body's general counsel says.
Heated counteroffensive
Notably, Coinbase is not alone in fighting the U.S. SEC regarding this particular allegation, as Binance is also facing related legal strain. However, Coinbase has filed a Motion to Dismiss (MTD) the lawsuit, citing an overreach by the commission in its definition of what constitutes a security.
Coinbase has a basis for requesting the court to dismiss the case as a July 13 ruling from Judge Analisa Torres in the Ripple Labs v. SEC case formed the right precedent to focus on. Notably, the SEC noted that programmatic sales of the coin on secondary marketplaces do not constitute a security.
Since Coinbase is a secondary marketplace where ADA, FIL and SOL, among others, are traded, it is not liable for any offense being alleged by the regulator.