Illinois is poised to withdraw its lawsuit against Coinbase, marking a significant shift as it joins three other U.S. states that have recently decided to drop similar legal actions against the cryptocurrency exchange.
State Officials Confirm Lawsuit Withdrawal
A spokesperson for Illinois Secretary of State Alexi Giannoulias shared on Thursday that the office plans to discontinue the lawsuit against Coinbase. However, the spokesperson did not provide a specific timeline for when this action will take place.
Background of the Lawsuit
Back in 2023, Illinois was among ten states that initiated legal action against Coinbase, alleging that the exchange violated state securities laws by offering its staking program. In a parallel development, the U.S. Securities and Exchange Commission (SEC) also filed charges against Coinbase for breaching federal securities regulations related to its staking product. Notably, the SEC opted to dismiss its lawsuit in February, paving the way for other states to reconsider their positions.
States Following Suit
Since the SEC’s withdrawal, several state securities regulators have also opted to abandon their cases against Coinbase. Kentucky, Vermont, and South Carolina have all dropped their lawsuits, signaling a trend among states reassessing their legal strategies against the exchange.
Current Status of Remaining Cases
Despite this wave of dismissals, several states are still pursuing staking-related lawsuits against Coinbase. These include Alabama, California, Maryland, New Jersey, Washington, and Wisconsin.
Inquiries into Ongoing Cases
Representatives from California, Maryland, and Wisconsin have not commented on the status of their pending litigation against Coinbase. Meanwhile, a spokesperson for the New Jersey Bureau of Securities indicated that their case remains open, and Bill Beatty, the securities administrator for the Washington Department of Financial Institutions, confirmed that Washington’s case against Coinbase is still in progress.
The Alabama Securities Commission has yet to respond to inquiries regarding its stance on the lawsuit.
In conclusion, as the legal landscape continues to evolve for cryptocurrency exchanges, the withdrawal of the Illinois lawsuit against Coinbase marks a noteworthy development in the ongoing dialogue between state regulators and digital asset platforms.
