Coinbase, the largest U.S.-based cryptocurrency exchange, announced that the Securities and Exchange Commission (SEC) plans to dismiss a lawsuit filed against it.
This move is seen as indicative of a more supportive approach towards the crypto sector under the Trump administration.
Coinbase revealed in a statement titled “Righting a major wrong” that SEC staff have tentatively agreed to drop the lawsuit, originally initiated during the Biden administration.
This lawsuit had charged Coinbase with operating as an unregistered securities broker, a claim that now appears set to be withdrawn, pending a formal vote by the agency.
SEC representatives have declined to comment on the developments. However, Coinbase CEO Brian Armstrong, in a CNBC interview, expressed optimism about the future.
“This is a really important signal that we are turning the page on the efforts by a small group of activists in the prior administration who unlawly attacked this industry,” he said. Armstrong also highlighted the progress towards achieving regulatory clarity in the U.S.
The news has positively impacted financial markets, with Coinbase shares rising 5% in premarket trading and Bitcoin prices increasing by 1%.
This move aligns with President Donald Trump’s campaign pledge to reduce the stringent enforcement practices that marked the crypto industry under former President Joe Biden.
Trump has voiced ambitions to establish the U.S. as the “crypto capital of the world” and has even launched his own meme coin.
The SEC had previously accused Coinbase of denying investors critical protections such as anti-fraud measures and routine inspections.
Gurbir S. Grewal, director of the SEC’s Division of Enforcement, had emphasized the importance of adhering to regulatory standards, stating, “You simply can’t ignore the rules because you don’t like them or because you’d prefer different ones.”
The cryptocurrency industry has long voiced concerns over the SEC’s approach under former Chair Gary Gensler, criticizing it for being overly stringent and not providing clear regulatory guidelines.
While the lawsuit against Coinbase is set to be dropped, legal actions against other exchanges like Binance and Kraken remain ongoing.
Armstrong criticized these regulatory actions as insincere, suggesting on the social media platform X that attempts by crypto companies to register had been thwarted by misleading offers from regulators.
This development suggests a potential shift towards more cooperative regulatory frameworks that could support the growth and legality of the crypto industry in the U.S.
