In a significant move, Coinbase has filed a motion to shift a securities lawsuit from Oregon’s state court to federal court. The lawsuit, initiated by Oregon Attorney General Dan Rayfield in April 2025, accuses Coinbase of selling unregistered securities, specifically 31 crypto tokens, without proper registration under Oregon law. Coinbase argues that this case mirrors a prior Securities and Exchange Commission (SEC) lawsuit, which was dropped earlier this year, and thus belongs in federal jurisdiction.
Key Arguments by Coinbase
• Federal Questions: Coinbase asserts that the case involves substantial federal legal questions, particularly regarding whether digital assets qualify as securities under the Howey test, a Supreme Court standard for investment contracts. This, they argue, justifies federal jurisdiction under the Grable doctrine.
• Federal Officer Removal: Coinbase also cites “federal officer removal” because the U.S. Marshals Service has engaged the company to sell seized crypto assets, some of which are named in Oregon’s suit. This, they claim, directly interferes with federal operations.
• Patchwork Regulation: Coinbase warns that allowing the lawsuit to proceed in state court could create a fragmented regulatory environment, forcing crypto firms to navigate a complex patchwork of state laws. This, they argue, would hinder innovation and limit consumer access to digital assets nationwide.
Broader Implications
The outcome of this case could set a crucial precedent for the balance between state and federal oversight of crypto firms. As lawmakers push for clearer regulations, such as the proposed Bipartisan Clarity Act of 2025, which aims to place digital asset oversight under the Commodity Futures Trading Commission (CFTC), the need for uniform federal regulation becomes increasingly evident.
