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TL;DR
- Attorney John E Deaton believes Coinbase has over a 50% chance of prevailing in its District Court case against the SEC, with improved odds at higher court levels.
- Prior to suing Coinbase for purportedly trading unregistered securities, the SEC initiated a comparable case against Binance.
- Ripple has secured several partial victories against the SEC’s assertion that XRP was an unregistered security. A definitive trial is scheduled for April next year.
‘Better Than 50%’
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John E Deaton – an American attorney representing numerous XRP investors in the lawsuit against the US Securities and Exchange Commission (SEC) – commented on another legal confrontation led by the regulator: the one involving the cryptocurrency exchange Coinbase.
He asserts that the exchange has “a real shot” with its motion to dismiss (MTD) the case, estimating its likelihood of achieving a victory at the District Court level at “better than 50%.” Furthermore, Deaton believes the chances for a Coinbase win at the 2nd Circuit level and the Supreme Court level are even more favorable:
“I have the odds for a Coinbase victory at the District Court level, better than 50%, and at the 2nd Circuit level, better than 60%, and at the Supreme Court level, better than 80%. Gary Gensler and the SECGov’s days of unconstitutionally expanding Howey, are limited.”
It is important to note that the agency filed a lawsuit against Coinbase at the beginning of June, accusing it of violating several laws and providing trading services with alleged unregistered securities. Before this, it lodged a lawsuit against another giant in the cryptocurrency sector – Binance.
The SEC vs. Ripple
Arguably, the most notable lawsuit that the SEC is engaged in is the one against Ripple. This legal confrontation commenced in December 2020 when the Commission claimed that the blockchain company sold XRP tokens valued in the billions as an unregistered security offering.
The dispute has gone through various stages in the subsequent years, with both parties exchanging accusations. The peak occurred in mid-July when a US Federal Judge determined that Ripple’s programmatic XRP sales did not represent an offer of investment contracts.
The crypto firm achieved its second partial victory at the start of October when the judges rejected the SEC’s request to appeal the initial ruling and a third victory when CEO Brad Garlinghouse and Executive Chairman Chris Larsen were absolved of all allegations made by the regulator.
The significant trial scheduled for April next year is expected to determine the resolution of the protracted conflict between the entities.
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