Coinbase Faces Dual State-Level Legal Battles Over Staking Services and Token Listings

In a significant development for cryptocurrency regulation in the United States, Coinbase is confronting two major state-level legal challenges that threaten to reshape the landscape for crypto services and token offerings. The first involves a narrowing but intensifying lawsuit over its staking services, while the second is a fresh lawsuit from Oregon alleging the exchange offered unregistered securities.

The staking lawsuit, which initially involved ten U.S. states, has now been reduced to just five, as revealed by CEO Brian Armstrong on social media platform X. This reduction suggests some state regulators may be reconsidering their stance. However, the financial consequences for users in the remaining states are mounting. Armstrong highlighted Maryland as a critical case, where a complete ban on Coinbase staking has locked approximately $8 million in earned staking rewards for local users, with that total growing daily. This situation directly impacts everyday investors who use staking for passive income and underscores the tangible cost of regulatory uncertainty.

Simultaneously, the Oregon Attorney General, Dan Rayfield, filed a civil lawsuit against Coinbase on April 9, accusing the platform of violating the Oregon Securities Law by facilitating the sale of at least 31 crypto tokens as unregistered securities. The complaint names major cryptocurrencies including XRP, Cardano (ADA), Solana (SOL), Chainlink (LINK), Polygon (MATIC), Aave (AAVE), Uniswap (UNI), and Maker (MKR). Notably, Oregon's action expands the list of tokens considered securities beyond the 18 named in the SEC's previous lawsuits against Coinbase and Binance.

The inclusion of XRP is particularly contentious, reigniting debate over its regulatory status despite Ripple Labs' partial legal victory against the SEC last year. Oregon's Attorney General argues that XRP still constitutes a security under state law.

Coinbase's Chief Legal Officer, Paul Grewal, publicly criticized the Oregon lawsuit, arguing it was filed on behalf of over 500,000 customers without direct consultation. He warned that such state-level actions risk creating a fragmented regulatory landscape that could deter innovation and harm the broader cryptocurrency industry. Coinbase is already engaged in a high-profile federal lawsuit with the SEC over similar allegations of operating as an unregistered national securities exchange.

Legal analysts suggest that while the Oregon case is state-specific, its outcome could influence other states to adopt similar approaches, forcing exchanges to modify token offerings based on local rules and potentially fragmenting access to digital assets across the U.S. The resolution of these concurrent legal battles will serve as a critical test case for the future of staking services and token trading in America, signaling how state and federal regulators view core mechanics of the crypto economy.