SEC Seeks 28-Day Extension to Review Coinbase’s Appeal in Ongoing Lawsuit
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The U.S. Securities and Exchange Commission (SEC) has requested an additional 28 days to review cryptocurrency exchange Coinbase’s appeal in its ongoing legal battle with the regulator.
The SEC argues that its newly established crypto task force could play a key role in resolving the nearly two-year dispute.
In a filing on February 14, the SEC stated that the task force’s work “may affect and could facilitate the potential resolution of both the underlying district court proceeding and potential appellate review.”
The agency emphasized that its review of crypto-related matters is still ongoing, necessitating more time to finalize its response to Coinbase’s petition.
Coinbase has agreed to the extension, moving the SEC’s deadline from February 14 to March 14.
The request follows a similar move made just days earlier when the SEC and Binance jointly asked a judge to pause their lawsuit for 60 days, citing the task force’s work in shaping a regulatory framework for the crypto industry.
Coinbase initially appealed to a U.S. court on January 21, seeking a ruling that crypto transactions on its platform do not constitute securities.
The exchange argued that clarifying whether secondary market crypto transactions qualify as investment contracts under securities laws is crucial for the industry.
This appeal came after Judge Katherine Failla granted Coinbase’s request for an interlocutory appeal on an earlier ruling that denied its motion for judgment.
Judge Failla also ordered a pause on all proceedings in the case until the Second Circuit Court reviews the appeal.
The legal battle dates back to June 2023, when the SEC sued Coinbase for allegedly offering unregistered securities.
The regulator claims the exchange failed to register as a broker, national securities exchange, or clearing agency, thereby avoiding the required disclosure obligations for securities markets.
Meanwhile, the SEC’s recently announced crypto task force has sparked speculation that long-running lawsuits against major crypto firms could be nearing resolution.
The task force is led by Commissioner Hester Peirce, known for her pro-crypto stance, and was introduced by acting SEC Chairman Mark Uyeda.
Coinbase Holds Over $420 Billion in Digital Assets for Users
Earlier this month, Coinbase announced that it now holds over $420 billion in digital assets on behalf of its users, surpassing the 21st largest bank in the United States in terms of assets under management (AUM).
At the time, Armstrong said the exchange’s AUM would position it as the 21st largest U.S. bank if it were classified as a traditional financial institution.
Armstrong also said that if Coinbase were categorized as a brokerage firm, it would rank as the 8th largest brokerage by AUM.
Coinbase’s $420 billion in AUM is over three times larger than the $112.9 billion managed by New York Community Bancorp (NYCB), which holds the 21st spot among U.S. banks.
More recently, Coinbase CEO Brian Armstrong said U.S. President Donald Trump’s crypto agenda has become a central topic of discussion across the crypto industry, financial markets, and the tech world.
Reflecting on his recent time at the World Economic Forum (WEF) in Davos, Armstrong revealed that conversations with major market leaders were dominated by Trump’s plans for digital assets.
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