In a defense of Coinbase that launched a new hearing date in July, the exchange noted that many of the SEC tokens brought to light by its allegations are outside the jurisdiction of the committee.
The long-awaited legal battle between Coinbase (NASDAQ:COIN) and the US Securities and Exchange Commission (SEC) is set to take place on July 13. Coinbase is just one of the crypto companies operating under the radar of the US FSA. A committee he claims that the exchange was operating its own crypto-asset trading platform as an unregistered national securities exchange, broker, and clearing agency. The company was also accused of not registering its staking-as-a-service program. The charges date back to 2019, claiming that Coinbase illegally generated profits.
SEC and Coinbase Case Set for July 13th
The date was moved to July following the exchange’s defense strategy, which involves filing its first response 40 days before the Aug. 7 deadline. Coinbase deployed an “iconic” defensive tactic, which led to a July court date with the US Securities Commission.
According to the rules, the SEC must file a response to Coinbase following the crypto company’s strategic defense. While the expected response date was supposed to be the 3rd of July, the watchdog requested an extended period given the Independence Day holiday on the 4th of July. The court approved the request. Moreover, the preliminary conference, originally scheduled for August 24, is now a pre-conference of the movement to be held on July 1. At a pre-order conference, the judge and attorneys meet to assess the steps needed to move the case to trial. They also fix dates for specific tasks.
In the Coinbase defense Leading up to a new hearing date in July, the exchange noted that many of the tokens the SEC has highlighted in its allegations are outside the committee’s jurisdiction. The company’s attorney wrote:
Coinbase responded to the SEC’s complaint with several defenses, including that the action violated due process and constituted a miscalculation. But there is a more fundamental problem with the SEC case — one the president acknowledged two years ago that entitles Coinbase to judge the pleadings now: the matter is outside the authority of the SEC.”
Coinbase defense
The exchange further argued that the regulator can only proceed if it considers the transactions in the digital assets and services described in the complaint to be “investment contracts.” This means that they are “securities” according to the Securities Act and the Exchange Act. Coinbase added:
“Since none of it is legally the case, the allegations must be dismissed.”
Attorney and legal commentator on Twitter MetaLawman likened the exchange’s tactic of sending its reply 40 days in advance to a typical “creative strategy”. “It appears that Coinbase is using this creative strategy to get useful documents for its case before the judge through the answer,” he explained.
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Ibukun is a crypto/financial writer interested in passing on relevant information, using uncomplicated words to reach all types of audiences. Apart from writing, she loves watching movies, cooking, and exploring restaurants in the city of Lagos where she is staying.