Key Takeaways
- Coinbase has been granted an interlocutory appeal by Judge Failla, allowing it to challenge the SEC's claims at the Second Circuit Court of Appeals.
- The appeal raises serious questions about the application of securities law to digital assets, particularly in relation to the Howey test.
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Coinbase has achieved an important legal milestone in its ongoing battle with the SEC, as Judge Katherine Polk Failla of the Southern District of New York granted the company a rare interlocutory appeal.
According to the to filethis decision allows Coinbase to take its case to the Second Circuit Court of Appeals.
The company will challenge the SEC's allegations, which include claims to operate as an unregistered exchange and broker-dealer.
In addition, the SEC is accusing Coinbase of selling unregistered securities through its stake program.
“In light of the SEC's strong objection, Judge Failla has granted our motion to pursue an interlocutory appeal and stayed the district court action,” said Paul Grewal, Coinbase's chief legal officer. on. X platform.
Judge Failla ruled that the appeal raises fundamental questions about whether digital asset transactions on Coinbase qualify as “investment contracts” under securities law, as defined by the Howey test.
The court indicated that guidance from the Second Circuit could significantly improve the resolution of the case.
Fox Business News reporter Eleanor Terrett called the conclusion “a huge legal win for Coinbase,” noting the unusual nature of such a claim.
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