The largest crypto exchange in the US Coinbase seems to be regularly involved in a legal battle. This time, the crypto exchange is accused of selling securities as cryptocurrencies.
Three Coinbase users – Christopher Underwood, Christopher Underwood, and Henry Rodriguez – filed a class-action lawsuit against the firm for more than 79 crypto assets listed on the platform. The claimants are accusing Coinbase of selling assets they consider as securities, which is unlawful according to the suit.
The lists of cryptocurrencies involved include Dogecoin (DOGE), Polkadot (DOT), Ripple (XRP), Solana (SOL), Chainlink (LINK), and others.
The Plaintiffs Demand Compensation Of $5 Million
According to the lawsuit filed with the district court in New York, those that have bought any of the assets should receive a collective compensation of $5 million for their losses.
The plaintiffs argued that Coinbase should have registered as a national securities exchange with the Securities and Exchange Commission. But this will result in several reporting and regulatory obligations generally applied to stock exchanges.
The SEC Keeps Delaying On Crypto Regulation And Classification
In addition, the SEC has been delaying the provision of a standard regulatory framework for crypto assets. Their classification has also been an issue, as the regulators are still dragging their feet on that aspect. This has led to confusion in the market regarding what should be treated as securities in the market and what should not.
The suit also commented on the recent statement made by SEC chair, Gary Gensler, who told the Senate Banking Committee that Coinbase is not registered with the SEC.
Based on previous similar suits against crypto companies, it’s highly unlikely that the recent suit will pass the initial filing or go to trial. But it’s another example that the confusion regarding the classification of crypto assets is increasing and many are not comfortable with the lack of strong regulation in the industry.
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