Blockchain Association files amicus brief in support of Ishan Wahi News ▸ US ▸ Coinbase ▸ Ampleforth ▸ Regulation
Blockchain Association files amicus brief in support of Ishan Wahi
BA: SEC's move to classify nine tokens as securities without prior court order potentially violated the creators' right to defend themselves.
1 min read
Updated: Feb. 14, 2023 at 11:00 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
The Blockchain Association (BA) filed an amicus brief in the ongoing Coinbase Insider Trading case on Feb. 13, alleging that the SEC improperly classified the tokens as securities — and denied its creators an opportunity to defend themselves.
“In this action, in particular, the SEC is engaging in regulation by enforcement against absent third parties. And the original creators of those tokens have no practical ability to be heard on the subject.”
The U.S. Securities Exchange Commission (SEC) charged a former Coinbase Product manager Ishan Wahi and his brother Nikhil Wahi for insider trading and securities fraud in July 2022. The brothers were accused of using insider information from Coinbase to profit roughly $1.5 million.
After about eight months of legal battles, the Wahi brothers pleaded guilty to the insider trading charges. However, Ishan pleaded not guilty to the securities fraud charges.
Ishan argued that the named tokens (AMP, XYO, LCX, POWR, RLY, RGT, DDX, DFX, and KROM) are not investment contracts, given that there is no contractual agreement between the developers and token holders.
SEC enforced rules without process
The BA argued that the SEC failed to engage with the public on rulemaking but enforced its rules without due process. As a result, the SEC’s action is considered a violation of the Administrative Procedure Act.
For the SEC to succeed in its enforcement action against Wahi, the Association said that the court has to engage in “9 mini-trials” to prove the named tokens are securities.
Mentioned in this article
Author 
Christian Nwobodo
Christian is a crypto-curious nerd who loves to investigate how protocols work under the hood. Christian is interested in DeFi protocol research, token economics, and on-chain analytics.
Latest US Stories
Latest Ampleforth Stories
Latest Press Releases
In this article
Ampleforth
$1.13369
Ampleforth is a digital-asset-protocol for smart commodity-money.
Powerledger
$0.29972
Power Ledger (POWR) is a blockchain-based platform released in May 2016 with the goal of disrupting the global energy industry by enabling local areas to sell and distribute solar power to their neighbors without the help of middlemen.
Rally
$0.01196
Rally is an open network for digital creators, crypto influencers, brands and celebrities to build tokenized communities.
Rari Governance Token
$0.36829
The Rari Governance Token is the native token behind Rari Capital.
DerivaDAO
$0.05536
DDX is the native token that is used for governance on the DerivaDEX exchange, fee reduction on the exchange, and for other programs.
Kromatika
$0.02538
KROM is a non-mintable ERC20 token with a fixed supply of 100 million tokens.