New Class Action Lawsuit Filed Against Coinbase, Brian Armstrong

Crypto exchange firm Coinbase faces another class action lawsuit alleging the company misled investors into buying securities. The complaint is brought by individual complainants claiming Coinbase has violated securities laws. In addition, the lawsuit argues Solana (SOL), Polygon (MATIC), Near Protocol (NEAR), Decentraland (MANA), Algorand (ALGO), Uniswap (UNI), Tezos (XTZ), and Stellar Lumens (XLM) are securities.

Class Action Filed Against Coinbase and Brian Armstrong

Plaintiffs Gerardo Aceves, Thomas Fan, Edwin Martinez, Tiffany Smoot, Edouard Cordi, and Brett Maggard have brought a class action against Coinbase Global and CEO Brian Armstrong, as per a court filing.

The complainants accuse Coinbase of intentionally and repeatedly violating California and Florida securities laws. They claim Coinbase admitted it is a “Securities Broker” in its user agreement, making digital asset securities sold by the exchange as investment contracts or other securities. The plaintiff also took aim at Coinbase prime brokerage as a securities broker/dealer.

They allege digital assets listed on Coinbase are securities and cite Algorand, Decentraland, Polygon, Near Protocol, Uniswap, Solana, Stellar Lumens, and Tezos as securities. In addition, they assert Coinbase Earn accounts violated securities laws by advertising and promoting for higher yields.

Plaintiffs are seeking full recession, statutory damages under state law, and injunctive relief in a demand for jury trial. The lawsuit is similar to other class actions and the SEC lawsuit.

Also Read: Shiba Inu Exec Fumes At Elon Musk Over X’s Security Concerns

Coinbase Seeks Clarity on Investment Contract Definition

Coinbase escalated its legal dispute with the U.S. SEC by filing an interlocutory appeal on the “investment contract” definition.

Paul Grewal, CLO of Coinbase, told CoinGape that the exchange has a higher chance of victory as the SEC’s interpretation of investment contracts doesn’t align with Second Circuit and Supreme Court cases. The moves came after Coinbase gained major clarity in the US Court of Appeals for the Second Circuit that secondary sales of crypto are not securities as there are no investment contracts.

Coinbase’s interlocutory appeal is also critical for Ripple Vs SEC lawsuit. The SEC could appeal Judge Torres’ ruling that programmatic sales of XRP are not securities.

Also Read: Elon Musk’s Tesla Adds Dogecoin As Payment Method, DOGE Price Rally 20%

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Varinder has 10 years of experience in the Fintech sector, with over 5 years dedicated to blockchain, crypto, and Web3 developments. Being a technology enthusiast and analytical thinker, he has shared his knowledge of disruptive technologies in over 5000+ news, articles, and papers. With CoinGape Media, Varinder believes in the huge potential of these innovative future technologies. He is currently covering all the latest updates and developments in the crypto industry.

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