Coinbase, the leading cryptocurrency exchange in the United States, has found itself in yet another legal dispute, this time over the selling of cryptocurrencies that may be considered securities.
Three Coinbase users are attempting to sue the firm over the platform’s 79 cryptocurrencies. According to the claim, they might be regarded securities, and hence the transactions could be deemed illegal.
The class action was launched last week in the southern district of New York by Christopher Underwood, Louis Oberlander, and Henry Rodriguez. They believe that everyone who bought any of these assets should be paid for trading losses up to $5 million in total.
Polkadot (DOT), Dogecoin (DOGE), Chainlink (LINK), Solana (SOL), and Ripple (XRP) are among the many cryptocurrencies.
The plaintiffs contend that Coinbase should have registered as a national securities exchange with the Securities and Exchange Commission (SEC). However, this would entail significant regulatory and reporting requirements, similar to those imposed on stock exchanges.
Furthermore, the SEC has been slow to regulate and categorize crypto assets, and the United States government is still a long way from developing any form of a regulatory framework.
The lawsuit made reference to SEC head Gary Gensler and his recent statements about Coinbase’s registration status:
“SEC chair Gary Gensler recently told the Senate Banking Committee that Coinbase had not registered with the SEC, “even though they have dozens of tokens that may be securities.”
The case is unlikely to go to trial or even get any further than this initial filing. Previously, similar litigation have yielded relatively little.
It was reported last year that five planned class lawsuits against cryptocurrency firms were voluntarily withdrawn in federal court in New York.
Coinbase is still listing many tokens, which is a far cry from its position a few years ago, when just a few assets could be exchanged.
The freshly introduced ApeCoin for BAYC NFT collectors is one of the most recent coins to be offered. APE has been added to Coinbase’s “experimental asset label,” which is a unique category for low liquidity assets that the firm urges care with.
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