A new class-action lawsuit has been filed against popular cryptocurrency exchange Coinbase Global by six customers. The lawsuit, filed on May 5th, includes two subsidiaries of Coinbase – Coinbase, Inc. and Coinbase Asset Management, LLC – as well as CEO Brian Armstrong.
The lawsuit alleges that several digital assets listed on Coinbase, including Solana, Polygon, Near Protocol, Decentraland, Algorand, Uniswap, Tezos, and Stellar, are actually securities. The plaintiffs argue that these tokens should be considered ‘investment contracts’ and are subject to state securities laws.
According to the lawsuit, Coinbase itself acknowledges being a “Securities Broker” in its user agreement, which the plaintiffs claim demonstrates that the defendants knowingly violated state securities laws and deceived users.
The lawsuit seeks full recission of purchase agreements, along with statutory damages under state law and injunctive relief. This legal action comes as Coinbase faces a separate lawsuit from the U.S. Securities and Exchange Commission (SEC) alleging violations of securities laws.
Coinbase has argued that the secondary sale of crypto assets does not constitute securities and has filed an interlocutory appeal in response to the SEC lawsuit. Additionally, pro-XRP lawyer John Deaton recently filed an amicus brief in support of a motion for interlocutory appeal on behalf of thousands of Coinbase customers.
Despite these legal challenges, Coinbase reported a significant increase in revenue for the first quarter of the year, surpassing expectations with $1.64 billion in revenue. Transaction revenue nearly tripled to $1.07 billion, with consumer transaction revenue alone doubling compared to the previous year.
