Coinbase Faces Renewed Legal Battle as Oregon Revives Old SEC Playbook

Crypto exchange Coinbase is facing another legal battle as Oregon’s Attorney General prepares to file a securities enforcement action against the cryptocurrency exchange. According to a blog post from Coinbase, the state is asserting “the same stale, repeatedly refuted theories” that the SEC previously dismissed with prejudice when it dropped its case against the company.

Coinbase Claims Oregon Lawsuit Undermines Federal Progress On Crypto Regulation

The exchange characterizes the action as an attempt to “resurrect the dead.” The exchange mentioned Oregon is bringing forward arguments that are “years out of date” and at odds with current public opinion, technological progress, and good governance. Coinbase stated it will take all necessary actions to defeat the lawsuit while continuing normal operations in Oregon.

The company views Oregon’s legal action as directly undermining bipartisan efforts at the federal level to establish crypto legislation. According to Coinbase’s blog post, momentum has never been stronger for passing clear federal rules that would allow domestic cryptocurrency businesses to operate and at the same time prevent “rogue state governments from bringing politically motivated actions against crypto firms.”

Paul Grewal, Chief Legal Officer at the top crypto exchange, expressed this sentiment on X, stating that the lawsuit is “exactly the opposite of what Americans should be focused on right now.” He characterized the Oregon lawsuit as a “backward” action that does nothing to protect consumers or solidify American leadership.

Coinbase’s blog post describes Oregon’s action as a desperate scheme that moves the cryptocurrency conversation backward rather than forward. The company suggests the state should have waited for Congress to enact clear guidelines instead of taking it upon itself to try to regulate a worldwide industry through enforcement.

Grewal further claimed that Oregon’s Attorney General’s office made it clear to Coinbase that “they are literally picking up where the Gary Gensler SEC left off.” The lawsuit comes at a time when Coinbase even provided the blueprint for crypto regulation in March.

Coinbase Maintains “Business As Usual” Despite Legal Challenges

Despite the pending lawsuit, Coinbase has assured its customers in Oregon and elsewhere that operations will continue normally in the state. The crypto exchange will also run its business as usual and will see this case, like others, through as far as necessary.

Coinbase characterized Oregon’s lawsuit as “meritless” and expressed confidence in its position on both the facts and the law. The blog post described the action as politically motivated.

The company described the move as a war against crypto that was previously waged by the SEC and its allies. The exchange suggested that the SEC has now acknowledged “that the vast majority of digital assets are not securities.”

It is worth noting that the SEC is seeking to create a regulatory-friendly environment for the cryptocurrency industry and has dropped several non-fraud lawsuits against crypto firms, including Coinbase. The court also recently agreed to pause the Ripple SEC lawsuit as both parties try to reach a settlement.