Published on January 21, 2024 21:46 GMT+00:00edited on January 21, 2024 21:49 GMT+00:00

What differentiates a security from a collectible? That question is at the heart of the Securities and Exchange Commission’s lawsuit against Coinbase, as the agency is accusing the company of selling unregistered securities and operating an unlicensed staking-as-a-service program. 

But after the SEC’s lawyers faced pointed questions from New York District Judge Katherine Polk Failla, who wondered aloud whether or not the agency’s definition of collectibles was too broad, a Bloomberg analyst has estimated that Coinbase currently has the edge in the case. 

“The judge wanted a limiting principle to the SEC definition of "investment contract" that wouldn't encompass collectibles. We view the one offered by Coinbase as more compelling, requiring investment in a business vs. just an …