Oregon’s Lawsuit Declares XRP and 30 Other Tokens as Unregistered Securities

Oregon’s lawsuit against Coinbase accuses the exchange of trading 31 crypto tokens, including XRP, as unregistered securities. The state alleges Coinbase violated securities laws by allowing these transactions. This shift follows the SEC’s recent dismissal of its cases against Coinbase and Ripple Labs, prompting calls for clearer federal regulation in the crypto sphere.

In a notable escalation in the ongoing tussle between regulatory bodies and the crypto world, Oregon’s recent lawsuit against Coinbase has brought XRP to the forefront, alongside 30 other tokens. This legal filing has accused the popular exchange of facilitating unregistered securities trading, contributing to a more rigorous scrutiny of cryptocurrency operations.

The Oregon authorities assert that Coinbase’s platform enabled the trading of numerous digital assets that they deem as unregistered securities. The complaint claims that the exchange’s services, including Coinbase Prime, allowed Oregonians to transact these 31 tokens without proper registration, thus breaching state securities laws.

A former SEC adviser, Justin Slaughter, voiced concerns over the breadth of the lawsuit, noting its far-reaching implications compared to similar actions by the SEC. He described it as a “kitchen sink lawsuit”, implying that it covers a wide variety of assets, notably including well-known tokens like UNI, AAVE, and LINK, besides XRP.

The lawsuit articulates specific grievances, stating that Coinbase violated laws by offering trading services for these digital tokens, described in legal terms as securities and investment contracts. It further alleges that Coinbase has facilitated transactions involving these unregistered assets for customers in Oregon, using both fiat and cryptocurrencies.

Oregon’s legal complaint provides an extensive list of the tokens under scrutiny, naming several more alongside XRP —such as ADA, MATIC, and SOL. This wide-ranging list signifies a significant shift in approach at the state level, especially given the SEC’s recent retreat from cases against Coinbase and Ripple Labs, hinting at possible federal uncertainty in regulation.

Importantly, the SEC dropped its lawsuit against Coinbase, which was initiated to contest its classification of operating as an unregistered securities exchange. Additionally, Ripple’s long-standing dispute regarding XRP’s status concluded with the SEC dropping its appeal, following a partial win for Ripple last year. With these changes, the crypto industry is increasingly advocating for clear federal legislation to safeguard against inconsistent state laws that could stifle innovation and market growth.