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Coinbase is leveraging the momentum from Judge Amy Berman Jacksons ruling in the SEC v. Binance case. The judges decision established that secondary sales of Binances BNB token do not constitute securities sales under the Howey test criteria.

In a letter, Coinbases attorneys accused the SEC of arbitrary rule-making without a consistent framework. They stated that the SEC has never coherently explained its regulatory process and is attempting to impose it retroactively on the digital asset industry through aggressive enforcement actions.

On June 27, Coinbase filed a lawsuit against the SEC and the Federal Deposit Insurance Corporation (FDIC), alleging that both agencies conspired to exclude the crypto industry from the banking sector.

Coinbase argued that the federal agencies failed to comply with the Freedom of Information Act and did not provide necessary documentation related to their rule-making deliberations, particularly concerning Ethereums transition to a staking-secured digital asset ecosystem.

The SECs classification of Ether (ETH) has faced scrutiny before. In 2018, SEC Corporation Finance Director William Hinman stated that ETH was not a security due to its sufficient decentralization. This assertion later became a key point in Ripple Labs defense against the SECs classification of XRP as an unregistered security, arguing the regulator lacked consistent criteria for defining a securities contract.

SEC Commissioner Mark Uyeda has criticized the agencys handling of the crypto industry, calling it problematic.

Judge Jacksons ruling in the SEC v. Binance case reinforces the precedent set by Judge Analisa Torres in SEC v. Ripple Labs. Judge Torres ruled that secondary sales of XRP did not constitute sales of unregistered securities, as the digital asset did not meet the SECs criteria for an investment contract. However, initial sales of XRP to institutional investors were deemed securities sales due to the specific circumstances of those transactions, rather than the inherent characteristics of the token.

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Coinbase Builds On SEC V. Binance Ruling Momentum - FinanceFeeds