The U.S. Securities and Exchange Commission (SEC) has been blowing a horn in its various legal clashes with crypto exchanges, asking courts to see how its recent win in the Terraform Labs dispute should convince other judges that the regulator is right about platforms like Coinbase and Binance trading unregistered securities.
While the SEC has suffered a number of setbacks in its crypto court cases, such as in its lawsuit against Ripple and in Grayscale Investments’ success challenging the agency’s spot bitcoin exchange traded fund (ETF) application rejection, the regulator chalked up a victory last week in its contention that Terraform was improperly offering securities through its Terra/Luna stablecoin offerings and the Mirror Protocol.
“The Terraform court resolved in the SEC’s favor issues relevant to the consideration of defendants’ motion in this case,” an SEC lawyer submitted to Judge Katherina Polk Failla in a January 4 filing in its court clash with Coinbase. That follows a similar filing the day before in the SEC’s dispute with Binance, meant to point out to other judges that the agency’s argument had prevailed elsewhere.
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Judge Jed Rakoff, the U.S. District Court for the Southern District of New York judge overseeing the Terra case, sided with the SEC in an end-of-year ruling. In it, he said that the case from defendants Terraform and founder Do Kwon “asks this court to cast aside decades of settled law of the Supreme Court,” the judge determined. “The court declines the defendants’ invitation.”