Legal Scholars Rally Behind Coinbase in SEC Dispute on Investment Contracts
Six law professors have issued an amicus brief supporting Coinbase and criticizing the U.S. Securities and Exchange Commission (SEC) over its stance on investment contract definitions.
The professors, hailing from various U.S. universities, including UCLA, Boston University, Fordham Law School, Widener University Delaware Law School, University of Chicago Law School, and Yale Law School, argue that tokens listed on Coinbase should only qualify as investment contracts if issuers establish contractual commitments with investors.
They delve into the historical roots of securities laws, asserting that the existing framework draws inspiration from “blue sky laws,” which emphasize contractual arrangements between issuers and investors to determine investment contracts. These legal scholars analyze case law to highlight the necessity of contractual bindings for investment contracts, a stance mirrored by Coinbase itself.
Coinbase’s filing emphasized that qualifying as an investment contract requires an ongoing business enterprise with enforceable obligations to investors. In contrast, the SEC’s filings present a broader perspective, suggesting that an arrangement could qualify as an investment contract even without a contractual obligation.
Clever Robot News Desk 15th August 2023
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