Coinbase must face customer lawsuit in New York: Judge

An American judge ruled that Crypto Exchange Coinbase has to face a collective appeal filed by customers in New York, Reuters reported.

The trial alleys that Coinbase has illegally sold titles and that he acted as a direct seller.

In a decision rendered on February 7, the American district judge Paul Engelmayer rejected the argument of Coinbase according to which it is not a statutory seller under the American federal law on securities. The exchange also argued that he had never transferred the title of the 79 tokens listed in the trial, which customers exchanged.

However, the judge underlined the argument that “Coinbase customers only transact with Coinbase himself”. According to the decision, this accusation leads to the conclusion that the exchange of crypto based in the United States was a seller.

In a statement For Reuters, Coinbase reiterated that he “does not insist, does not offer or sell titles”. The exchange plans to fight to reject other complaints in the case.

The last development occurs more than nine months after a court decision in April 2024, aspects of the case which had previously been rejected by Judge Engelmayer. Although the judge canceled the trial in February 2023, an order from the 2nd Circuit Court of Appeals de l’US in Manhattan in April 2024 authorized certain charges to stand.

The decision of judge Engelmayer on February 7, 2025, almost two years after the original verdict, authorizes the parties of the case that the court of appeal decided should proceed.

In May 2024, a group of Coinbase customers from California and Florida has filed a new legal action Against Coinbase and his CEO Brian Armstrong alleging that the sales of Crypto of the exchange have violated the laws on securities.

The trial has identified several tokens, including Solana, Polygon, near the protocol, decentraland and Algorand, as titles. Coinbase, however, argues that it does not lists or sells titles and that secondary crypto sales do not meet the criteria to be classified as such.

In addition to collective appeals, Coinbase continues to fight against a separate legal action filed by the American Commission for Securities and Exchange. The SEC continued Coinbase in June 2023, alleging that the company operated as an unregistered securities scholarship.