- A group of legal scholars from prestigious U.S. universities have submitted an amicus brief in support of Coinbase in its lawsuit against the U.S. Securities and Exchange Commission (SEC).
- The scholars argue that the definition of “investment contract” is crucial in determining whether tokens traded on Coinbase are unregistered “securities”.
- Several other entities, including the Blockchain Association and the Chamber of Digital Commerce, have also submitted amicus briefs in support of Coinbase.
In the ongoing lawsuit between Coinbase, a leading cryptocurrency exchange, and the U.S. Securities and Exchange Commission (SEC), a group of legal scholars from top American universities have submitted an amicus brief in support of Coinbase. The scholars argue that the definition of an “investment contract” is key in deciding whether tokens traded on Coinbase are unregistered “securities”. Additionally, several other organizations have also submitted amicus briefs backing Coinbase.
Legal Scholars Rally Behind Coinbase
On August 11, a group of six legal scholars from Yale University, the University of Chicago, Boston University, Widener University, UCLA’s law school, and Fordham Law School submitted an amicus brief to the court in support of Coinbase. The scholars, all experts in securities law and related fields, submitted the brief in their individual capacities, not as representatives of their respective institutions. They hope that their expertise will aid the court in its decision-making process.
The Importance of Defining “Investment Contract”
The scholars argue that the definition of an “investment contract” is crucial in determining whether tokens traded on Coinbase are unregistered “securities”. To answer this question, they suggest that the court must apply the Supreme Court’s ruling in SEC v. Howey. The amicus brief provides an analysis and explanation of how “investment contracts” were understood and defined at the time of the Howey decision and the enactment of federal securities laws.
Support from Other Entities
Several other entities have also submitted amicus briefs in support of Coinbase. These include the Blockchain Association, the Council for Digital Currency Innovation, the Advancement Council, CTATech, a16z, Paradigm, Senator Cynthia Lummis, the Chamber of Digital Commerce, and the DeFi Education Fund. Lummis, a known supporter of cryptocurrencies, argues that the U.S. Congress has not given the SEC the authority to regulate cryptocurrencies and that defining a regulatory framework is the job of Congress, not the SEC.
Conclusion
In conclusion, the ongoing lawsuit between Coinbase and the SEC has drawn the attention of legal scholars and other entities who have submitted amicus briefs in support of Coinbase. The outcome of this case could have significant implications for the cryptocurrency industry, particularly in terms of how tokens are classified under securities law.
