Since the beginning of its conflict with the SEC, Coinbase has always defended itself by opposing attacks from the regulator. However, the case has just taken a new turn: Brian Armstrong’s company has just appealed to a Manhattan court judge to dismiss the charges against him. Coinbase denounces the abuse of power by the SEC: according to it, the institution would carry out illegal operations against the cryptocurrency industry.
Coinbase Seeks to Dismiss SEC Complaint
Recently, the American exchange Coinbase filed a request to invalidate Securities and Exchange Commission (SEC) complaints made against him. In addition, the Web3 juggernaut will soon ask a judge to assess the relevance of the trial initiated by the regulator.
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As a reminder, on June 6, 2023, the institution dedicated to the American financial markets had sued the company of Brian Armstrong. She accused him of not having respected the laws in force on securities by allowing the trading of a dozen cryptocurrencies considered as financial securities (securities). Its staking program has also come under heavy criticism from the regulator.
In his letter filed Wednesday night in Manhattan federal court, Coinbase rejects SEC accusations by arguing that the cryptocurrencies available on its platform are not securities. At the same time, the company notes too great a dissonance between the legislation in place and the interpretation made by the American regulator:
” Rather than testing a new viewpoint by crafting notices and commentaries, the SEC chose to deploy its aggressive agenda through punitive retroactive enforcement action. The agency’s enforcement power is significant but not unlimited. The SEC’s action here is beyond those limits and illegal. »
The cryptocurrency exchange denounces an abuse of power by the SECendangering the competitiveness of the American market to the benefit of other regions of the world like Europe and Asia.
In its long 177-page document, the American company claims to be in favor of the regulation of cryptocurrencies and its technologies. Nevertheless, it must be clear and precise in order to limit the “regulatory loopholes” allowing an abusive interpretation of the law.
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SEC Repercussions on Coinbase Stock and the Crypto Market
What are the consequences of this case on the Coinbase share price? Located at $64 per unit at the beginning of June, its price quickly fell when the SEC launched its lawsuits against it, as well as its main rival Binance. In just two days, its price fell by 22%.
Nevertheless, its action being correlated to the cryptocurrency market, the company took advantage of the recent rise in Bitcoin (BTC) to not only offset its losses, but also rebound on a bullish trend. Currently, its price stands at $72, its highest since March 2023.
Coinbase (COIN) stock price over the last 6 months
On his side, the cryptocurrency market is marked by a record dominance of Bitcoin (BTC) never observed since the previous bullrun. Today, the king of cryptocurrencies represents more than 50% of the total market capitalization.
This dominance reflects a growing interest in Bitcoin at the expense of altcoins which, after experiencing a temporary rise, returned to lows following the lawsuits with the SEC.
Therefore, while BTC has grown by 84% since January 2023, MATIC, BNB and ADA record -22.5%, -2.5% and +12% respectively. The sluggish price of these cryptocurrencies is linked to the affair with the SEC: considering them as securities, their prices have fallen by 20% to 30% each.
note that ETH differs from altcoins by the omnipresence of the Ethereum ecosystem in Web3 and the current confusion of the SEC around the regulation to apply to it. Thus, Ether has not been impacted by these legal cases and has seen its price increase by 50% over the last 6 months.
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Published by Editions Larousse
Source: ReutersTradingView
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Always enthusiastic about new technologies, I gradually moved closer to Web3-related activities during the year 2021. Over time, I wanted to add my stone to the building. It was then that I became an editor, with the aim of explaining cryptocurrency-related topics to as many people as possible.
Timothy Bourbotte
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