Authorities from three U.S. states—Kentucky, Vermont, and South Carolina—have decided to withdraw their lawsuits against Coinbase, following the example set by the U.S. Securities and Exchange Commission (SEC). This occurred after the SEC closed its case against the exchange in February 2025.
This is reported by Business • Media
The financial regulator in Kentucky made the corresponding decision on March 31, 2025, while South Carolina did so on March 26, and Vermont on March 13. According to reports, seven other states continue to support a collective lawsuit against Coinbase.
Reasons for Withdrawing the Lawsuits
This legal process began shortly after the SEC filed a lawsuit against Coinbase, in which regulators from ten states accused the platform of violating federal law through its Earn program.
The staking of crypto assets offered by Coinbase was considered an unregistered securities offering. Despite this, the exchange refused to shut down the program.
Appeal to Congress
Coinbase’s Chief Legal Officer, Paul Grewal, urged Congress to pass legislation regarding crypto assets that would prevent such practices. He emphasized that oversight of the industry should be conducted at the federal level rather than at the level of individual states.
Additionally, the SEC has closed several other cases, changing its approach following the change in administration in the U.S. Previously, Coinbase CEO Brian Armstrong had highlighted the importance of legalizing the rights of stablecoin issuers to distribute profits among asset holders.