Coinbase wins dismissal of most customer claims in lawsuit over unregistered token sales

On July 30, 2026, U.S. District Judge Paul Engelmayer dismissed the vast majority of a customer lawsuit against Coinbase. The ruling eliminated claims on matched transactions representing 99.97% of trading volume, while allowing claims on the remaining 0.03% of inventory transactions to proceed. The decision hinges on statutory seller definitions under federal law, occurring amid a broader rollback of cryptocurrency regulatory oversight under the second Trump administration.

Coinbase lawsuit dismissal ruling

• ▪Coinbase customers sought unspecified damages in a lawsuit initiated in 2021 over 60 tokens, including XRP and dogecoin, which they claimed were unregistered securities.
• ▪U.S. District Judge Paul Engelmayer in Manhattan dismissed the majority of a proposed class-action lawsuit on July 30, 2026, where customers accused Coinbase of illegally selling unregistered securities.

Matched versus inventory transactions

• ▪Judge Paul Engelmayer allowed customers to pursue claims over inventory transactions, which accounted for 0.03% of Coinbase's trading volume and comprised at least $178 million in sales.
• ▪Judge Paul Engelmayer dismissed all customer claims based on matched transactions, which accounted for approximately 99.97% of Coinbase's trading volume.

Statutory seller definition

• ▪Judge Paul Engelmayer ruled Coinbase was a statutory seller for inventory transactions because it passed token titles to buyers and acted as a dealer and underwriter.
• ▪Judge Paul Engelmayer ruled Coinbase was not a statutory seller for matched transactions because it did not pass ownership of tokens to buyers or solicit transactions through basic token overviews.

Trump-era cryptocurrency deregulation

• ▪Coinbase has experienced a rollback of regulatory oversight under the second presidential administration of Donald Trump.
• ▪The cryptocurrency trade group Digital Chamber supported Coinbase, arguing that an expansive definition of statutory seller could stifle innovation and drive trading volume outside the United States.

SEC enforcement action withdrawal

• ▪Judge Paul Engelmayer previously dismissed other federal securities law claims against Coinbase in 2023.
• ▪In 2025, the U.S. Securities and Exchange Commission ended a civil enforcement lawsuit brought in 2023 that accused Coinbase of trading unregistered securities.

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