Coinbase announced that the SEC has agreed to drop its lawsuit against the company with prejudice, meaning the case cannot be refiled. This decision, pending approval from the SEC’s Commissioners, suggests a potential shift in regulatory attitudes towards cryptocurrency under the current administration.
The SEC’s lawsuit, initiated in 2023, claimed that Coinbase operated as an unregistered national securities exchange, broker, and clearing agency. Coinbase countered that the SEC had not established clear rules for the cryptocurrency sector, making it difficult to determine any violations.
According to Coinbase CEO Brian Armstrong, the company spent $50 million on legal fees to defend itself against the allegations. This figure reflects only external legal costs and does not include internal employee expenses. Armstrong emphasized the importance of this legal battle for the broader cryptocurrency industry, noting that many companies lack the financial resources to engage in such extensive litigation.
Despite the favorable outcome, Armstrong expressed the need for comprehensive legislation to regulate cryptocurrency in the U.S. He warned that without clear and favorable regulations, the country risks falling behind international competitors.
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