Coinbase Is Off The Hook With The Sec

In a development akin to Tom officially ending his pursuit of Jerry, the Securities Exchange Commission (SEC) agreed to drop its enforcement lawsuit accusing Coinbase of running an unregistered securities exchange, the crypto marketplace said yesterday.

Coinbase, which has been fighting the case since 2023, said it’s set to walk away without having to pay a fine and celebrated it as “a complete win.” The agency’s apparent change of heart reflects a wider crypto-friendliness from the Trump administration.

Gary Gensler’s baby

The case was a flagship effort of the SEC’s broad crypto crackdown when it was led by Biden appointee Gary Gensler, who believed the industry was rife with fraud.

• The SEC argued that crypto vendors should follow the same extensive regulations as stock and bond exchanges.
• Coinbase tried to challenge the case in court, but a federal judge refused to toss it, setting it on a path to become a game-changing precedent for the industry that lets you trade Poopcoin.

Big picture: The outcome is a victory for the crypto industry players who derided Gensler’s SEC as an innovation-stifling bully. But critics claim that the case vaporizing as fast as the value of a shady meme coin could harm trust in the Wall Street regulator and fortify fraudsters.—SK