South Carolina has recently dismissed its lawsuit against crypto exchange Coinbase over its staking services, which were accused of offering unregistered securities. This decision was reached in a joint stipulation between the crypto exchange and the South Carolina Attorney General’s securities division on March 27, following a similar move by Vermont. The lawsuit was part of a legal action taken by 10 US states against Coinbase’s staking services in 2023, but now South Carolina has become the latest state to drop the case.
Coinbase’s chief legal officer, Paul Grewal, hailed the dismissal as a victory for American consumers and hoped that other states with bans on staking would follow suit. South Carolina residents allegedly lost an estimated $2 million in staking rewards due to the lawsuit. Grewal emphasized the need for clear rules and consumer protections for the 52 million Americans who own crypto.
In a separate development, a state lawmaker in South Carolina introduced the “Strategic Digital Assets Reserve Act” on March 27, which would allow the state treasurer to allocate up to 10% of certain state funds to cryptocurrencies like Bitcoin. The proposed bill, unlike other state crypto reserve bills, specifically mentions Bitcoin and allows for a high ceiling of 1 million Bitcoin to be held in the state’s reserves. The bill aims to establish a Strategic Digital Assets Reserve that could include Bitcoin in various state funds managed by the treasurer.
This move comes as part of a broader trend of states exploring the use of cryptocurrencies and Bitcoin reserves, with 42 Bitcoin reserve bills introduced across 19 states. Additionally, President Donald Trump recently signed an executive order to create a Strategic Bitcoin Reserve and a Digital Asset Stockpile using cryptocurrency forfeited in government criminal cases.
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