Some cryptocurrencies that the plaintiffs have identified as securities are Solana (SOL), Polygon (MATIC), Near Protocol (NEAR), Decentraland (MANA), Algorand (ALGO), Uniswap (UNI), Tezos (XTZ), and Stellar Lumens (XLM).
Brian Armstrong, CEO of Coinbase and the biggest U.S. cryptocurrency exchange by volume, is the target of a new class-action complaint that claims the company misled investors into purchasing assets. Customers are suing the firm, claiming it used an unlawful business strategy. The corporation is already facing a lawsuit similar to this one.
Scott+Scott, a law firm based in California, sued Coinbase in the Northern District of the state. The plaintiffs in the case are residents of Florida and California and include Gerardo Aceves, Thomas Fan, Edwin Martinez, Tiffany Smoot, Edouard Cordi, and Brett Maggard. The lawsuit claims that Coinbase has been in violation of state securities laws with its digital asset sales practices since its establishment.
Coinbase is accused by the complainants of admitting in its user agreement that it is a “Securities Broker.” This means that the exchange sells digital asset securities as investment contracts or other types of securities. Coinbase Prime Brokerage was also included in the lawsuit as a securities broker and dealer.
On trial before a jury, the plaintiffs ask for complete reversal of the decision, as well as injunctive relief and state-law statutory damages. Similar to previous class-action lawsuits, this one claims that Coinbase’s securities sales harmed consumers.
Coinbase, on the other hand, challenged the applicability of securities laws by claiming that sales of secondary crypto assets did not constitute securities transactions. After considering a number of factors, the court reversed and upheld several rulings made by the lower court.
Although both Coinbase and the SEC have been in the spotlight recently for their legal dispute over the classification of tokens traded on Coinbase as securities, this new complaint is separate. In reaction to the judge’s decision to let the case continue, Coinbase has now filed an interlocutory appeal.
John Deaton, a crypto lawyer who is actively campaigning to depose Elizabeth Warren from her Senate position, submitted an amicus brief in favour of a request for interlocutory appeal on behalf of 4,701 Coinbase users in a filing made on April 26 in the Southern District of New York, United States District Court.
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