The Securities and Exchange Commission (SEC) has dropped its civil enforcement case against Coinbase Inc. and Coinbase Global Inc.

According to the February 27 press release, the SEC and Coinbase filed a joint stipulation, effectively ending years of contentious litigation.

Coinbase SEC Lawsuit Comes to an End

The SEC initiated a case against Coinbase in June 2023. The regulator accused the exchange of violating agency rules by facilitating trading in several crypto tokens that it claimed should have been registered as securities. 

Coinbase CEO Brian Armstrong described the legal battle as costing “millions of taxpayer dollars” and causing “irreparable harm” to the industry. The battle has now concluded with a full dismissal. 

According to Armstrong’s statement, the agreement with SEC staff involved no fines or changes to Coinbase’s business model. 

The dismissal of the Coinbase case comes amid a broader shift in the SEC’s strategy toward crypto regulation. Acting Chairman Mark Uyeda pointed out that, for years, the Commission has focused on enforcement actions to communicate its stance on crypto. It has not engaged the public in the process.

“It’s time for the Commission to rectify its approach and develop crypto policy in a more transparent manner,” Uyeda stated.

Uyeda pointed to the newly established crypto task force as a step in the right direction. Last month, the SEC revealed the formation of a new crypto task force under the leadership of Commissioner Hester Peirce. The task force aims to address the long-standing uncertainties surrounding the regulatory classification of digital assets.

Meanwhile, the industry has reacted positively to the dismissal of the Coinbase case.

“SEC is working overtime with all of their moves over the last few weeks. Genuinely impressive. Really did not expect things to be moving this fast or unwinding this fast,” Bloomberg’s ETF analyst James Seyffart posted on X.

The dismissal marks the latest in a string of SEC retreats from high-profile crypto cases. Over the past few days, enforcement actions against Uniswap, OpenSea, Consensys, and Gemini have also been dropped.

Emilie Choi, Coinbase’s Chief Operating Officer, celebrated the outcome on X. She expressed satisfaction with being on the “right side of history.” 

“We’ve won the battle, now let’s win the war: pro-innovation legislation that delivers industry certainty for the long term,” Choi added.

While this marks a significant victory for Coinbase and the crypto industry, all eyes are now on the SEC’s ongoing lawsuit against Ripple. The case has been ongoing for years and remains unresolved. 

However, the SEC’s recent actions do not necessarily indicate an impending resolution for Ripple.

“The Commission’s decision to seek dismissal of this litigation does not reflect the Commission’s position on any other case,” the joint stipulation clarified.

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Bitcoin has experienced a sharp decline in price this week, dropping from $95,700 to below $80,000. The crypto king’s recovery seems uncertain, as large wallet holders, known as whales, have capitalized on the price dip, selling a substantial amount of their BTC holdings. 

This selling pressure further worsens the situation for investors who are already reeling from the downtrend.

Bitcoin Holders Are Cashing Out

Whales and sharks, specifically wallets holding 10 or more BTC, have been active in the market, dumping around 6,813 coins, approximately worth $540 million, since last week. This is the largest drop since last July and serves as a bearish indicator, suggesting that further price declines could be in store. 

Despite the selling pressure, the possibility of accumulation from these large holders could signal a potential market reversal. Historically, these whales tend to influence the market significantly, so their actions should not be overlooked, as they may also begin accumulating at lower levels once the market stabilizes.

The overall sentiment is still negative, but it is important to consider that this behavior could also suggest a shift in strategy. If these large investors begin accumulating BTC again, it may indicate confidence in the long-term potential of Bitcoin.

Looking at the broader market, Bitcoin’s recent downturn has also been accompanied by significant realized losses. Between February 25 and 27, over $2.16 billion in losses were realized, primarily coming from recent market entrants.

Of these losses, approximately $927 million—42.85% of the young cohort’s total—occurred in just one day. The losses ended up marking the largest single-day loss since August 2024. This substantial sell-off from newer investors is a concerning sign, as it could deter further participation in the market.

These losses reflect the harsh reality that newer market participants are facing significant setbacks, which could reduce overall investor confidence. As long as this trend persists, it may weigh heavily on Bitcoin’s price recovery. This could further exacerbate the bearish sentiment in the market.

BTC Price Is Struggling

Bitcoin is currently trading at $79,539, having already lost the support of $80,313. Given the recent developments, BTC is likely to test the next support level at $76,741. This level has historically acted as a key bounce point, offering some hope for a price rebound.

However, if the selling pressure continues and investor confidence weakens further, Bitcoin could fall below $76,741 and approach the support of $71,529. A drop to this level would significantly extend the losses and deepen the bearish outlook for the cryptocurrency.

To invalidate the bearish thesis and spark a potential recovery, Bitcoin must reclaim the support of $80,313 and make its way back to $85,000. If this happens, it could signal the beginning of a reversal and the possibility of recovery.