Coinbase has filed a petition with the Second Circuit Court of Appeals, seeking a ruling that crypto trades on its exchange do not qualify as securities. This appeal is part of Coinbase's ongoing litigation with the SEC, which alleged in June 2023 that the exchange was operating as an unregistered securities exchange. In its recent filing, Coinbase emphasized the necessity of clarifying whether secondary market crypto transactions are investment contracts, stating that such clarity is crucial for the multi-trillion-dollar crypto industry. They contend that transactions conducted on their platform are asset sales rather than securities transactions, as buyers and sellers remain anonymous and have no ongoing obligations after the sale. The SEC's suit against Coinbase has led to inconsistent interpretations of securities laws across different jurisdictions, prompting Coinbase to argue that the appeals court should resolve this significant legal question. Judge Katherine Failla previously permitted Coinbase's appeal, highlighting the conflicting conclusions drawn by various judges on this matter, thereby intensifying the importance of regulatory clarity for the digital assets market.

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