Investing in cryptocurrency is like buying a Beanie Baby, says a Coinbase lawyer: It's no different than buying an American Girl doll or maybe even a baseball card.
Cryptocurrency is just another version of Beanie Babies, a lawyer for Coinbase said in court to argue against the currency's classification as a security. The lawyer said cryptocurrencies are more collectibles than actual shares in a company.
“It’s the difference between buying Beanie Babies Inc. and buying Beanie Babies,” said Coinbase attorney William Savitt, according to Bloomberg.
Savitt compared cryptocurrencies to collectible stuffed animals in a New York federal court when arguing for the dismissal of the Securities and Exchange Commission's lawsuit in June 2023.
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According to Bloomberg, Savitt told U.S. District Judge Katherine Polk Failla that currency is different from securities because those who buy them do not have a stake in the companies from which they come, as they would if they bought stocks or bonds would buy.
According to Fox Business, legal experts say it could take two to six weeks for Failla to make a decision in the case.
This is not the first time that Coinbase has compared cryptocurrencies to Beanie Babies.
“It is similar to selling a property, the value of which may fluctuate after the sale. Or a condominium in a new building project. Or an American Girl Doll, a Beanie Baby, or a baseball card,” Coinbase’s lawyers said in a filing in August 2023.
The motion also points to a judge's ruling that found Ripple Labs' crypto coin XRP was not a security.
Why did the SEC sue?
According to a statement from the SEC, the SEC filed the lawsuit because Coinbase “operated its crypto asset trading platform as an unregistered national securities exchange, broker, and clearinghouse.” It said the commission also accused Coinbase of “failing the offer and sale of its crypto asset stake-as-a-service program.”