🏛️ Will SEC be Triumphed Over Again by the Great Coinbase?
🌐 The cryptocurrency world is gearing up for a major legal showdown as the U.S. Securities and Exchange Commission (SEC) prepares to face Coinbase in court. The hearing on Coinbase's petition is scheduled for Wednesday, January 17.
⚖️ This case has been likened to the protracted legal battle between the SEC and Ripple, raising questions about whether we are on the brink of another lengthy legal dispute. More detailed information will emerge after the hearings on Wednesday.
🔍 The hearings have four possible outcomes, each with its unique consequences:
Scenario 1: The judge rejects Coinbase's request
SEC faces a relatively minor obstacle to victory. All they need to show is that they allege facts that make their claims plausible. If the judge rejects Coinbase's request, the case will continue for a year or more, considering motions for summary judgment, similar to the Ripple case.
Scenario 2: The judge grants Coinbase's “preliminary injunction” request
This outcome would mean that the entire case would be terminated at the district court level. After this, the SEC would have the option to appeal to the Second Circuit Court of Appeals.
Scenario 3: The judge takes the case “without prejudice”
In this case, the SEC would have the opportunity to amend the complaint to address deficiencies noted by the judge. However, if the court determines that the SEC lacks Congress-granted authority to regulate cryptocurrency exchanges, amending it would be futile.
Scenario 4: The judge grants the motion for specific claims
The judge may grant the request regarding claims related to 13 cryptocurrencies but reject it regarding the betting service. The case would then move to the discovery stage, focusing solely on the betting service and whether it meets the requirements of an investment contract.
🤔 While it's unlikely that the judge will make a decision at this hearing, the way he poses questions may provide some hints about the potential outcome.
*This is not investment advice.
