Coinbase vs SEC Hearing Today - Summary (Patreon)

TLDR

In the ongoing legal battle between the SEC and Coinbase, a recent hearing took place under the supervision of a well-prepared and knowledgeable Judge. While no ruling was made during the 5-hour session, the Judge's understanding of the case and its implications left a positive impression. The Judge did not reveal any inclination towards either side's arguments, and the SEC lawyers were better prepared than in previous hearings.

Coinbase's lead lawyer, William Savitt, effectively made his points, especially during the closing arguments. Although the Judge seemed hesitant about dismissing the case based on the Major Questions Doctrine, it is speculated that she might allow the case to proceed to discovery, similar to the Ripple case.

Despite the uncertainty, it is believed that Coinbase will ultimately win the case. However, comprehensive crypto legislation from Congress could potentially resolve the issue, though it is unlikely to happen this year. A written decision on the motion is anticipated within the next three months.

FULL DETAILS

coinbase case summary: SEC v. Coinbase

The long awaited hearing is over.

As expected, there was no ruling from the Judge.

There were no knockout blows delivered by either side and, frankly, not a lot of high points over the course of the 5 hour hearing.

The Judge was the star of the show.

She was exceptionally well prepared.

She had drafted 14 pages of questions for the hearing.

She understood the terminology and the technology.

She is the kind of Judge you want to handle a case of this magnitude.

There was some interesting banter about the relative merits of Judge Rakoff's ruling in the Terraform Labs case and Judge Torres' decision in  @Ripple

.  Both Judges work in the same building with Judge Failla.

But the Judge gave nothing away in terms of how she viewed the reasoning of each of those cases.

There was a general consensus that tokens are not "in and of themselves securities" but the SEC argued, nonetheless, that transactions of tokens on secondary trading platforms like Coinbase can still constitute sales of investment contracts.

The SEC lawyers were better prepared than when they were caught flat footed in July and were generally effective making their case.

The lead lawyer for Coinbase, William Savitt of Wachtel Lipton, was methodical in his approach to answering the Judge's questions.

Each side was given a few minutes of summation time to say whatever they wanted at the end and, in that space, Savitt definitely stepped up his game and finished with some very strong closing points.

I watched the Judge carefully.  She is either genuinely undecided about how to rule or she is a great actor.

The one message I took away was she is uncomfortable with the idea of dismissing the case on the basis of the Major Questions Doctrine.

My guess (and it's just a guess) is she is going to allow the case to go forward to discovery, like the Ripple case.

But, I continue to believe, as noted in my pinned tweet, that Coinbase will ultimately win the case in the end.

Congress, of course, could put a stop to the whole thing with adoption of comprehensive crypto legislation but that won't happen this year.

I expect the *Judge will issue her written decision on the motion within the next 3 months.