The SEC has decided to drop its lawsuit against Coinbase, the largest US cryptocurrency exchange, potentially signaling a shift in the regulation of digital assets in the United States.
History of the SEC's Case Against Coinbase
In March 2023, SEC's scrutiny intensified concerning Coinbase's staking products. By June 2023, a lawsuit was filed accusing Coinbase of operating an unregistered securities exchange, trading at least 13 tokens without proper registration.
Regulatory Policy Shifts and Political Context
The election of President Donald Trump in November 2024 caused a shift in crypto regulation. The administration took a lenient approach, aiming to establish the US as a global crypto hub. In January 2025, Coinbase was allowed to appeal a legal issue regarding the Howey Test and its application to traded cryptos.
Impact on the Crypto Industry
The dismissal of this case against Coinbase is expected to have far-reaching implications for the crypto industry, potentially setting a precedent for digital asset regulations in the US and worldwide. This decision is pending final approval by SEC leadership next week.
Dropping the case against Coinbase could mark a significant shift in US crypto regulation, opening new avenues for digital asset companies.
