Coinbase currently deals with a new legal complaint executed by three users who ask for a refund of at least USD 5 million.
American exchange Coinbase is dealing with a new legal struggle. This time, the complaint comes from users who believe the company is making sales of digital assets that can get considered securities.
Three users issued a legal complaint in the Southern District Court of New York to fight against the entity for at least 79 crypto tokens listed on the network. According to the accusers, these items can be securities and, therefore, the sales would be illegal according to the demand.
The users, Christopher Underwood, Louis Oberlander, and Henry Rodriguez, issued the class action lawsuit. They stated that anyone who received these assets should receive a reimbursement due to business losses of at least USD$5 million.
The list counts on at least 79 tokens and includes some popular items such as Polkadot (DOT), Dogecoin (DOGE), Cardano (ADA), and Shiba Inu.
No Registration with the SEC
The complainants state that the accused company should have complied with the Securities and Exchange Commission (SEC) registration policy and presented the company as a national stock exchange. However, this action would require crucial regulatory and reporting obligations that usually apply to stock exchanges.
Additionally, the SEC experienced some delays in regulating digital currencies, and the US government is still far from bringing any semblance of a regulatory framework. The lawsuit also highlights SEC Chairman Gary Gensler’s thoughts on Coinbase’s registration.
SEC Chairman Gary Gensler argued that Coinbase does not have any registration with the SEC, even though they house many items that may be securities. Gensler had said before that a regulatory framework for US entities focused on exchanges and crypto operations is necessary.
Gensler’s needs got exposed by both the SEC and the CFTC since both agencies joined efforts to address all these cases. There is a possibility that digital assets would get linked to illicit activities.
Another SEC official who has also emphasized the need for regulations is Hester Peirce, better known as Crypto Mom. At the end of last year, she stressed that it was essential for the regulatory body to establish clear regulations related to cryptocurrencies.
On the other hand, in June, Commissioner Dan Bercovitz highlighted that commercial operations in the Decentralized Finance (Defi) sector could be illegal within the US based on the legal frameworks currently in force.
Various media outlets highlighted that it is unlikely that the lawsuit would evolve and go beyond this initial presentation since similar cases haven’t presented such an evolution. Last year, at least five legal complaints against crypto entities got voluntarily dissolved in a federal court in New York.
Coinbase Keeps Including Tokens
Coinbase keeps listing various tokens, which is a far cry from its stance a few years ago when only a few could get traded.
One of the latest tokens to get listed is the recently released ApeCoin for non-fungible token collectors. Coinbase included APEs under the experimental asset label, a specific panel intended for illiquid assets that the company suggested users be cautious when trying to handle.
By: Jenson Nuñez
