Cryptocurrency exchange giant Coinbase has reached an agreement with the U.S. Securities and Exchange Commission (SEC) to dismiss the financial regulator’s case against Coinbase, marking a dramatic turn of events from when Gary Gensler was the agency Chair.
Coinbase expressed gratefulness to the revamped SEC under Acting Chair and Commissioner Mark Uyeda for making the deal possible.
Coinbase CEO Brian Armstrong made a video to personally announce the development Friday, saying the Commissioners still need to take a vote on the matter, but the exchange is hopeful.
“If this goes through, it’s a really big deal, not just for us, but for the whole crypto industry,” he said.
It’s not just Coinbase getting some much-awaited reprieve. Devin Finzer, the co-founder of non-fungible token (NTF) marketplace OpenSea, revealed Saturday that the SEC “is closing its investigation into OpenSea.”
What a Dismissal Could Mean for Crypto As Per Experts
For Armstrong, getting the case dismissed could be “an important signal about where things are going,” referring to the significant changes within the SEC since U.S. President Donald Trump stepped into power.
Coinbase Chief Legal Officer Paul Grewal pointed out in a series of posts on X that the case will be dismissed “with prejudice.”
Attorney Jeremy Hogan, a well-followed figure in crypto, a lawsuit that will be dismissed with prejudice means the case “cannot be refiled later, not even a settlement agreement with some major concessions.”
For Grewal, the case’s dismissal following an official Commissioners’ vote will mean that “the U.S. can finally get back to doing what it does best: building innovative tech that improves the world.”
Financial services lawyer James Murphy, another popular crypto lawyer who goes by MetaLawMan on social media, is expecting “more dismissals to follow.”
On Saturday, he also responded to questions about whether the SEC’s lawsuit against Ripple will also be dismissed. He is expecting a potential settlement in the Ripple case, considering how the “Ripple situation is more complex than the crypto exchange cases.”
Bitwise Head of Research Ryan Rasmussen said the announcement alone about the SEC agreeing to dismiss the lawsuit was a “monumental moment” for the industry.
While Bitwise had been expecting Coinbase to win in the courts, Rasmussen noted that what the news actually highlights is the “pivot” that’s happening in Washington.
Tech trade group the Chamber of Progress said the SEC made the right choice. The group’s Director of Financial Policy Kyle Bligen said a dismissal should “close the chapter on Gary Gensler’s misguided effort to delegitimize crypto rather than regulate it.”
What About the OpenSea Investigation?
The SEC under Gensler was marked by not just lawsuits but also countless investigations into crypto and blockchain firms. The SEC dropped Wells notices across the industry, and OpenSea was among the platforms that received a notice on that warns companies of a potential lawsuit.
Commander Crypto, a prominent figure in the NFT segment, said the SEC ending its probe into OpenSea indicates that the once very popular offerings are “not securities.”
The two major moves the SEC made in recent days has reawakened excitement in the crypto space following consecutive weekends in the red.
It remains to be seen whether the Wall Street regulator will make a decision regarding the other lawsuits the Gensler SEC initiated and if other investigations will end amid an improving regulatory landscape in the U.S.
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