The crypto industry is no stranger to legal battles, and Coinbase has been fighting its share of them. The latest one took place in the Southern District of New York, where a proposed class-action lawsuit accused the cryptocurrency exchange of selling unregistered securities and failing to register as a broker-dealer. The customers who transacted on the Coinbase and Coinbase Pro platforms claimed that the company acted as an "intermediary" in their transactions, collecting transaction fees and bypassing disclosure rules meant to protect investors in traditional securities.

However, U.S. District Judge Paul Engelmayer had a different opinion. He ruled that Coinbase had no direct role in the transactions, despite promoting tokens and participating in "airdrops" to boost trading volume. The judge said that such activities are "insufficient" to qualify the company as a seller. He dismissed the federal securities law claims with prejudice, meaning they cannot be brought again.

This is a victory for Coinbase, but it's not the only legal challenge it's facing. The crypto exchange is still battling class-action cases in various states, including Georgia and New Jersey. The dismissed lawsuit sought to block Coinbase from trading tokens without registering as a securities exchange or broker-dealer, and obtain damages for losses and transaction fees.

Scrutiny of the crypto industry has been growing, especially after the tumbling of cryptocurrency prices and the bankruptcy of several key participants, including FTX exchange and Three Arrows Capital. The U.S. Securities and Exchange Commission has also been taking action, charging Genesis Global Capital and Gemini Trust with selling unregistered securities.

Coinbase has admitted to receiving SEC subpoenas and information requests concerning its customer programs and processes for listing assets. While the company has been cleared of the unregistered securities allegations, it's likely that more legal challenges will come its way in the future. The crypto industry is still finding its footing and navigating the complex regulations, and companies like Coinbase will continue to face obstacles as they try to provide a secure and compliant platform for their users.

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