![](https://cryptodaily.blob.core.windows.net/space/coinbase%20lawsuit%20win%201.jpg)
Coinbase emerges victorious in recent lawsuit over alleged securities violations
The US Court of Appeals of the Second Circuit has ruled that Coinbase’s secondary sales of cryptocurrencies did not violate the Securities Exchange Act. Is the crypto industry winning the fight?
Coinbase secondary sales of crypto did not violate securities law
In addition to its dispute with the US Securities and Exchange Commission (SEC), Coinbase is also involved in a lawsuit filed by private plaintiffs who claim that the cryptocurrency exchange sold them unregistered securities.
With the recent Appeals Court ruling that the sales met the criteria for securities, the main argument of the plaintiffs has been defeated. However, the plaintiffs believe that these rulings are a step towards making cryptocurrency exchanges more accountable.
Does this mean cryptocurrencies are not securities?
The victory for Coinbase has significant implications for the entire crypto sector. Another judge ruling that secondary sales of cryptocurrencies are not considered securities brings crypto one step closer to legitimacy. Investors who want to trade cryptocurrencies and were concerned about the legality can now breathe a sigh of relief, at least until the next enforcement agency action.
New securities rules are needed
This lawsuit highlights the need for the US to update existing securities rules or even create new ones that cover the entire crypto sector. Given the rapid pace of innovation in this space, it is likely that updated or additional laws will be necessary regardless of the SEC’s stance.
US lags behind
The US continues to lag behind in updating its financial rules, while the rest of the world makes progress. It is surprising that a government known for championing innovative technology is attempting to suppress a sector that has already made significant breakthroughs in finance and other areas of technology.
US court system is still upholding the law
Fortunately, the US court system remains reliable in upholding the law, even when faced with prosecutions brought by government enforcement agencies. The courts maintain necessary neutrality and are critical of any regulatory agency that attempts to bully and interpret the law unfairly. Hopefully, this continues.
Disclaimer: This article is provided for informational purposes only. It should not be used as legal, tax, investment, financial, or any other form of advice.