SEC scores big win in lawsuit against crypto exchange Coinbase

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The Securities and Exchange Commission scored a major win in its lawsuit against Coinbase
on Wednesday, as a judge ruled that its claim that the cryptocurrency exchange engaged in unregistered sales of securities could be heard by a jury at trial.

Coinbase’s shares fell around 2.5% on news of the ruling in Manhattan federal court rejecting its bid to dismiss the SEC’s complaint.

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The regulator first filed suit against Coinbase in June, alleging the company was acting as an unregistered broker and exchange. The agency also demanded the company be “permanently restrained and enjoined” from continuing to do so.

In her ruling Wednesday, U.S. District Judge Katherine Polk Failla wrote, “The ‘crypto’ nomenclature may be of recent vintage, but the challenged transactions fall comfortably within the framework that courts have used to identify securities for nearly eighty years.”

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