New developments are taking place in the SEC Coinbase battle. With its decision in favor of Coinbase, the US Supreme Court (Supreme Court) paved the way for the SEC to be placed in the middle of the criticism arrows again in the USA. The U.S. Supreme Court supported Coinbase’s request to stop individual litigation, deciding to stop appeals aimed at referencing disputes to private arbitration.
On Friday, five of the nine Supreme Court judges upheld Coinbase’s request, which overturned a lower court ruling overturned by a user suing after money was stolen from his account by a scammer.
A victory for individual cases
The decision qualifies as an undisputed victory for Coinbase.
Although not expected to be a direct precedent for the cryptocurrency industry, this decision is considered the kind of outcome that could impact other lawsuits against Coinbase as this is the first time a crypto company has the right to present an argument before the US Supreme Court.
In general, companies often opt for arbitration against lawsuits. Because this is seen as a cheaper and faster process than filing a lawsuit in court.
Following Friday’s decision, Coinbase may continue to enforce arbitration.
“We overturn the court’s decision and, in line with this view, send it back for further stages of the case.”
US Supreme Court/Coinbase Case
In one of the lawsuits that the Supreme Court overturned, the exchange’s California client, Abraham Bielski, claimed that a fraudster stole more than $30,000 from his Coinbase account last year, arguing that Coinbase failed to investigate or refund in violation of the Electronic Funds Transfer Act.
In the second nullified lawsuit, Coinbase allegedly cheated customers and violated California’s misleading advertising law regarding a dogecoin prize draw in 2021. This was also opened by former customers of Coinbase.
In both cases, Coinbase has challenged previous lower court rulings that countered its argument that issues should be resolved through arbitration.
It’s important to note that Coinbase has struggled with US regulators especially over the past few months.
History of the SEC Coinbase war
Recently, the SEC filed a complaint against Coinbase, alleging that it operates the crypto-asset trading platform as an unregistered national stock exchange and broker.
Recently, Coinbase counterattacked and demanded an explanation from the SEC.
It was stated that Coinbase, who wrote a letter to the court regarding the SEC, did not respond to the questions asked of the SEC. The answer that Coinbase wants from the SEC is to put forward a clear regulation for the crypto sector and to answer the questions asked by Coinbase in this regard. Coinbase lawyers are accusing the SEC of accusing crypto industry players of breaking the law despite clear undisclosed regulations. Coinbase requests that the SEC respond to its regulatory clarification petition in a maximum of 60 days or less.
The SEC, on the other hand, requested an additional 4 months on June 13 to respond to Coinbase’s petition.
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