A U.S. federal judge has ruled against Coinbase’s argument that it does not qualify as a “statutory seller” under federal law, clearing the way for an investor lawsuit to move forward in New York.
The decision means the cryptocurrency exchange must now face allegations that it sold unregistered securities.
According to a February 7 Reuters report, U.S. District Judge Paul Engelmayer determined that Coinbase must answer claims that it acted as a seller of securities without proper registration.
Investor Lawsuit Claims Coinbase Sold 79 Unregistered Securities
The lawsuit, filed by investors, alleges that Coinbase offered 79 cryptocurrencies classified as securities without registering as a broker-dealer.
The case had previously been dismissed in February 2023 by the District Court of Southern New York, but the Circuit Court of Appeals later revived key parts of the lawsuit.
Judge Engelmayer noted that Coinbase’s business model suggests it acts as a direct seller to customers, rather than merely facilitating trades, reinforcing the plaintiffs’ claims.
Despite its legal challenges, Coinbase remains a dominant player in the U.S. cryptocurrency market, serving as the largest trading platform and custodian for U.S. spot Bitcoin ETFs.
Coinbase has been engaged in a legal dispute with the SEC since June 2023, when the regulator accused the company of operating an unregistered securities exchange.
In January 2024, Coinbase petitioned a U.S. appeals court, arguing that cryptocurrency trades should not be classified as securities transactions.
When we filed our original request, we asked for all pause letters that were identified by the Office of Inspector General. Without telling us or the Court, FDIC limited their search for pause letters to only those “contained” in the report — so other pause letters may exist.…
The exchange also filed a separate lawsuit against the SEC and the FDIC, accusing them of attempting to block digital asset firms from banking services and failing to comply with Freedom of Information Act requests.
Despite legal challenges, Coinbase continues to expand operations.
Just recently, the exchange acquired Spindl, an onchain advertising and infrastructure platform, in a move aimed at enhancing the visibility of projects built on its Ethereum layer-2 network, Base.
Coinbase CEO: Trump’s Crypto Plans Spark Buzz in Crypto
Last week, Coinbase CEO Brian Armstrong said U.S. President Donald Trump’s crypto agenda has become a central topic of discussion across the crypto industry, financial markets, and the tech world.
Reflecting on his recent time at the World Economic Forum (WEF) in Davos, Armstrong revealed that conversations with major market leaders were dominated by Trump’s plans for digital assets.
“Basically, every conversation I had with major market leaders was focused on what the Trump administration planned to do on crypto,” Armstrong said.
He added that Trump’s bold vision is pushing industry players to step up, with many striving to avoid being left behind in the rapidly evolving landscape.
During the WEF, Trump pledged to make the United States the “world capital of artificial intelligence and crypto.”
This commitment, one of his first public statements since taking office on Jan. 20, has set a transformative tone for the industry.
Armstrong praised Trump’s approach, along with the leadership of Argentina’s President Javier Milei and El Salvador’s President Nayib Bukele, for embracing free markets as drivers of prosperity.
Among Trump’s speculated plans is the creation of a Strategic Bitcoin Reserve, though his latest executive order hints at a broader vision.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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By Nermeen Nabil Khear 