Home CryptocurrencyAltcoin SEC Had Trouble Arguing Beanie Babies Are Not Securities: Crypto Lawyers

SEC Had Trouble Arguing Beanie Babies Are Not Securities: Crypto Lawyers

by SuperiorInvest

The US securities regulator reportedly “failed” to effectively argue the difference between Beanie Babies and securities during a recent hearing in New York, one of the few signs that could bode well for Coinbase in its defense, according to the lawyers.

The cryptocurrency exchange has been trying to get a New York court to dismiss a U.S. Securities and Exchange Commission lawsuit against it, with oral arguments recently heard during a five-hour hearing on Jan. 17.

Reflecting on the procedure in a post on would lead to a class action lawsuit against the seller of Beanie Babies.

Hogan said the regulator then tried to distinguish Beanie Babies from securities before the judge, but “for the most part fails because the truth is, to the SEC, a Beanie Baby IS a security.”

“Today [Coinbase] The hearing revealed a key flaw in the SEC’s legal theory: it turns almost every asset on the planet into a security,” said Jake Chervinsky, chief legal officer at crypto venture capital firm Variant.

Judge Failla seemed to see it the same way after describing the situation as a “spectrum of collectibles regulated by the SEC,” according to Chervinsky.

“After hours and hours, this much remains clear: the SEC continues to claim broad authority over all investments without offering any limiting principles for its definition of an investment contract.” reflected Coinbase Chief Legal Officer Paul Grewal in a Jan. 18 post on X.

Lawyers Don’t Trust the Important Issues Doctrine Argument

Meanwhile, part of the hearing was devoted to arguments over primary issues doctrine: a 2022 U.S. Supreme Court ruling that says agencies should delegate authority to Congress on certain matters. Many crypto companies, including Coinbase, have attempted to use this as a reason to dismiss their respective SEC lawsuit.

However, securities attorney James Murphy said in a Jan. 17 report cheep that Judge Failla seemed “uncomfortable” with the idea of ​​dismissing the case based on the Supreme Court ruling.

On the other hand, Chervinsky said the judge “noted problems with the SEC’s case” in light of Senator Cynthia Lummis’s amicus brief outlining the current congressional debate over how to regulate cryptocurrencies, which supported Coinbase’s motion to reject.

Related: US GAO Recommendations to SEC Ahead of Timely Bitcoin ETF Approval Revealed

Judge Failla closed the hearing with a clear statement that she would not make a decision on Coinbase’s motion to dismiss today. It is possible that she could issue a partial dismissal, deciding to dismiss parts of the case but not others.

“My guess (and it’s just a guess) is that she will allow the case to move forward to discovery, like the Ripple case,” Murphy said.

He predicted that Judge Failla would rule on the motion to dismiss within the next three months and that Coinbase would “ultimately win the case.”

The SEC did not immediately respond to Cointelegraph’s request for comment.

Magazine: DeFi’s billion-dollar secret: the insiders responsible for the hacks

Source Link

Related Posts