Just weeks after the SEC dropped its federal lawsuit against Coinbase and the courts delivered a landmark win for Ripple (XRP), the state of Oregon has filed its own complaint against Coinbase, alleging violations of state securities laws. The move has reignited legal tensions and intensified the crypto industry’s battle against fragmented regulation in the U.S.
The lawsuit, filed by Oregon Attorney General Ellen Rosenblum, accuses Coinbase of:
- Selling unregistered securities
- Undermining consumer protections via arbitration clauses
- Evading regulatory oversight by exploiting legal gray zones
The case draws upon Oregon Revised Statute 59.331, a provision empowering the state to enforce securities regulations locally, even amid shifting federal stances.
“Coinbase has for years defied the regulatory structure and requirements established by the Oregon Legislative Assembly to protect Oregon investors,” the complaint reads.
🛡️ Coinbase Hits Back: “Politically Motivated”
Coinbase’s Chief Legal Officer Paul Grewal took to X (formerly Twitter) to criticize the lawsuit as opportunistic and politically charged. He accused Oregon’s legal team of:
- Ignoring the SEC’s recent loss in the Ripple (XRP) case
- Overlooking Judge Failla’s decision to grant Coinbase’s interlocutory appeal
- Employing private law firms seeking profit over principle
- Labeling the new SEC chairman, Paul Atkins, as a “crypto lobbyist”
- Mocking the reassignment of Gensler’s former crypto lead to the IT department
“Not exactly subtle,” Grewal wrote, framing the complaint as legal posturing disconnected from the evolving federal approach to crypto.
⚖️ The Bigger Picture: A Fragmented Regulatory Landscape
This latest state-level action highlights a deepening divide between federal and local enforcement strategies:
- SEC recently folded in its case against Coinbase without clarifying legal definitions.
- Judge Torres’ 2023 ruling in the XRP case held that public sales of XRP do not constitute securities, a decision the SEC chose not to appeal.
- Judge Failla’s greenlight for Coinbase’s appeal puts the definition of digital asset transactions under the Howey test in question, a key issue now heading to the Second Circuit Court of Appeals.
The contrast between federal retreat and Oregon’s aggressive stance underlines the regulatory uncertainty facing crypto firms, especially those operating across multiple jurisdictions in the U.S.
🔮 What’s Next?
As the case progresses through Oregon’s court system, it could become a test case for the limits of state-level authorityin digital asset regulation. If successful, it may embolden other states to pursue similar actions, even as the SEC recalibrates its approach under new leadership.
For Coinbase, it’s yet another chapter in an increasingly complex legal saga—one that reflects the broader struggle between innovation and regulation in the crypto economy.
