SEC’s Supplemental Authority in Coinbase Lawsuit
The U.S. Securities and Exchange Commission (SEC) has submitted a notice of supplemental authority in its ongoing lawsuit against Coinbase. The SEC is urging the court to consider the recent ruling in SEC v. Terraform Labs, which supports its opposition to Coinbase’s Motion for Judgment on the Pleadings.
The SEC highlights that the Terraform court ruling favored the SEC and addressed important issues related to the consideration of Coinbase’s motion. It emphasizes that an investment contract, as defined by the court, does not refer to a mere contract, transaction, or scheme.
The court’s application of the ‘Howey Test’ in the Terra case to identify certain tokens as securities is also deemed relevant to Coinbase’s alleged listing and offering of unregistered securities.
SEC Asserts Relevance of Terra Ruling in Binance Lawsuit
In a separate development, the SEC has also filed a notice of supplemental authority in its lawsuit against Binance and Changpeng Zhao (CZ). The SEC argues that the Terra ruling has relevance in this case as well and can be used to counter motions seeking dismissal of the lawsuit.
The SEC has also included supplemental authority regarding Binance’s guilty plea and settlement with the Department of Justice (DOJ). However, Binance and CZ have criticized the SEC for introducing irrelevant aspects from a different case.
Hot Take: SEC Strengthens Its Position with Terra Ruling
The recent ruling in SEC v. Terraform Labs has significantly bolstered the SEC’s position in its legal battles against Coinbase and Binance. With this ruling, the court affirmed that an investment contract entails more than just a contract or transaction, providing crucial support for the SEC’s claims against these crypto platforms.
By urging the courts to consider the Terra ruling, the SEC aims to secure favorable judgments in its lawsuits and establish a precedent that defendants have indeed violated securities laws. This move showcases the SEC’s determination to assert its oversight power and regulate the crypto industry effectively.
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