Coinbase Wins Big in Court Battle Over Token Sales

Coinbase has won the dismissal of much of a lawsuit from customers who accused the largest U.S. cryptocurrency exchange of illegally selling securities without registering as an exchange or broker-dealer.

The lawsuit, which began in 2021 and was filed over 60 tokens including XRP and dogecoin, sought unspecified damages for Coinbase's alleged illegal sales.

U.S. District Judge Paul Engelmayer dismissed all claims based on 'matched' transactions where Coinbase paired customers' buy and sell orders, accounting for an estimated 99.97% of trading volume, worth hundreds of billions of dollars.

However, the judge allowed customers to pursue claims over 'inventory' transactions, where Coinbase fills orders from tokens it owns, which accounted for just 0.03% of trading volume, worth at least $178 million in sales.