Coinbase Legal Battle Escalates with Class-Action Lawsuit

A lawsuit against Coinbase was filed in the U.S. District Court for the Northern District of California, San Francisco Division by a group of plaintiffs from Florida and California.

Gerardo Aceves, Thomas Fan, Edwin Martinez, Tiffany Smoot, Edouard Cordi, and Brett Maggard are among the plaintiffs who allege that Coinbase has intentionally violated state securities laws since its founding through the selling of digital assets.

They contend that because Coinbase admits in its user agreement that it is a “Securities Broker,” tokens like Solana (SOL), Polygon (MATIC), and others that are offered on the site need to be categorized as securities.

The lawsuit seeks full rescission of the sales, statutory damages, and injunctive relief, with the case set to proceed to a jury trial. This lawsuit bears resemblance to another class-action suit alleging consumer harm from Coinbase’s sale of securities.

Coinbase’s Defense

Coinbase, however, refutes the claims, asserting that secondary crypto asset sales do not meet securities transaction criteria. This legal challenge mirrors the ongoing dispute between Coinbase and the U.S. Securities and Exchange Commission (SEC) over token classifications.

Separately, pro-crypto attorney John Deaton has filed an amicus brief in favor of Coinbase in their SEC legal dispute, offering pro bono assistance. His participation highlights Coinbase’s attempts to address regulatory obstacles and look for clarification on compliance-related issues.

The SEC has accused Coinbase of operating as an unregistered national securities exchange and has made complaints against the company involving its cryptocurrency staking program, among other legal hurdles. The larger conflicts between crypto businesses and regulatory bodies are highlighted by these litigation.

Coinbase and other industry titans are bracing for additional legal battles as the SEC steps up its enforcement of cryptocurrency laws. The verdicts in these court cases will have a big influence on investor protection laws and digital asset regulations.