DeFi celebrates ‘giant win’ as Coinbase Wallet emerges victorious from SEC allegations

A recent decision by a judge in the United States to dismiss allegations against Coinbase Wallet is being celebrated by crypto lawyers as a victory for self-custody wallets and decentralized finance (DeFi) apps. U.S. District Judge Katherine Failla ruled on March 27 that the Securities and Exchange Commission (SEC) had made sufficient claims that Coinbase was unlicensed and its crypto staking offering was unregistered securities. However, the judge also determined that the SEC failed to prove that Coinbase conducted brokerage activity through Coinbase Wallet. This decision is seen as a significant win for browser-based wallet extensions and similar applications. It could also be used by DeFi app developers facing similar lawsuits to argue that they did not act as unregistered brokers. While industry advocates see this ruling as a curb on the SEC’s overreach, legal experts believe that the SEC still has a strong case against Coinbase. The case will now move into the discovery phase where both sides will gather evidence for their arguments.