Recent developments indicate that the U.S. Securities and Exchange Commission (SEC) has taken significant steps to drop charges in lawsuits against both Coinbase and OpenSea, marking a notable shift in the regulatory landscape for cryptocurrency and NFT platforms in the United States.
Coinbase announced that SEC staff had agreed in principle to dismiss the lawsuit against the company, pending final approval from the SEC’s commissioners, expected to vote on the matter the following week. This lawsuit, initiated in June 2023 under the Biden Anti crypto administration and former SEC Chair Gary Gensler, accused Coinbase of operating as an unregistered securities exchange, broker, and clearing agency, and unlawfully offering its staking-as-a-service program.
The case was seen as a cornerstone of the SEC’s aggressive enforcement push against the crypto industry, alleging that Coinbase facilitated trading in at least 13 crypto tokens that should have been registered as securities.
The preliminary agreement to dismiss the case comes with no fines, penalties, or mandated changes to Coinbase’s operations, representing a clean slate for the exchange.
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Coinbase CEO Brian Armstrong hailed this as a major victory, not just for his company but for the broader crypto industry, aligning with President Donald Trump’s campaign promise to make the U.S. a “crypto capital.” The dismissal, if finalized “with prejudice,” would prevent the SEC from refiling similar charges, potentially setting a precedent for other crypto exchanges facing regulatory scrutiny. This shift follows Trump’s inauguration and the replacement of Gensler, suggesting a more crypto-friendly stance under the new Republican-led SEC.
Similarly, on February 21, 2025, reports emerged that the SEC concluded its investigation into OpenSea, the leading NFT marketplace, without pursuing enforcement action. The probe, which had been ongoing, centered on whether NFTs traded on OpenSea constituted unregistered securities—a contentious issue that sparked debate within the crypto community.
OpenSea’s CEO, Devin Finzer, confirmed that the SEC informed the company it would not take action, closing the investigation. This decision came after OpenSea received a Wells notice in August 2024, signaling potential charges, and had prepared a $5 million legal fund to defend NFT artists and developers against possible SEC actions. Finzer viewed the outcome as a win for the NFT and broader Web3 community, arguing that classifying NFTs as securities was a misinterpretation of existing laws that could stifle innovation. The SEC’s decision to drop the case without charges alleviates a significant regulatory overhang for OpenSea and the NFT sector, which had faced uncertainty amid the agency’s earlier hardline approach.
These developments reflect a rapid pivot in SEC policy under Acting Republican leadership following Trump’s inauguration on January 20, 2025. The agency has also established a dedicated crypto task force and rescinded prior accounting guidance, signaling a softer stance compared to Gensler’s tenure, when the SEC targeted major crypto players like Coinbase, Binance, and Kraken. The simultaneous retreat from legal battles with Coinbase and OpenSea suggests a strategic recalibration, possibly influenced by political pressure and Trump’s pro-crypto agenda, including his firing of Gensler.
For Coinbase, the dismissal removes a nearly two-year legal burden that had been a focal point in the debate over whether crypto assets fall under securities laws, as defined by the 1946 Howey Test. For OpenSea, it ends fears that the SEC might broadly categorize NFTs as securities, which could have disrupted the digital art and collectibles market.
Industry leaders, such as Blockchain Association CEO Kristin Smith, have called this a “turning point,” potentially paving the way for a more favorable regulatory environment. However, critics like Dennis Kelleher of Better Markets argue that this retreat undermines investor protections, accusing the SEC of bowing to crypto industry pressure.
These cases appear resolved in favor of the companies, with Coinbase awaiting final US SEC commissioner approval and OpenSea’s investigation formally closed. This dual rollback has boosted optimism in the crypto and NFT sectors, though the long-term implications for regulation remain uncertain as the Trump administration’s policies continue to unfold.