A former Coinbase manager is challenging the SEC’s classification of nine cryptocurrencies as securities.
Ishan Wahi, who has been accused of insider trading, is arguing that the SEC is trying to establish authority over the crypto asset sector by setting precedents through the courts, rather than obtaining it from congress.
The lawyers representing Wahi claim that the cryptocurrencies involved in the alleged insider trading scheme, including AMP, RLY, POWR, and LCX, are not securities and therefore no securities laws were violated.
According to the filing, the value of the tokens at issue derives mostly from market fluctuations and not from a centralized party’s efforts.
The SEC Chairman Gary Gensler believes that most cryptocurrencies are securities and can be classified as such under the Howey Test. However, he has conceded that Bitcoin is worth classifying as a commodity rather than a security.
