In an appeal to U.S. District Judge Katherine Failla, Coinbase attorneys argued that the digital assets listed in the SEC lawsuit are not investment contracts. The position of lawyers: the exchange does not enter into investment contracts with users, and in the case of digital assets traded on its platform, the contract was concluded at an earlier stage – between the creator and the buyer of the crypto-asset.
According to Coinbase’s legal department, the cryptocurrency platform does not violate U.S. securities laws because none of the crypto-exchange instruments can qualify as a stock or a bond.
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“If the asset in question is not a security, then the SEC has no jurisdiction to regulate it,” Coinbase attorneys said.
On that basis, the Coinbase administration is asking the court to dismiss the SEC’s lawsuit and dismiss the case for lack of jurisdiction.
Amid a court investigation into the operations of cryptocurrency exchanges Binance and Coinbase, the U.S. House of Representatives has asked the head of the SEC to provide a justification for reviewing the market structure of digital assets.