Shares in Coinbase soared by more than 20% on Thursday after a judge dismissed a class-action lawsuit against the cryptocurrency exchange.
US District Court Judge Paul Engelmayer rejected claims made by the plaintiffs that Coinbase sold them unregistered securities and failed to register as a broker-dealer.
The suit sought damages from the sale of the digital assets, arguing that these were illegal contracts because Coinbase is not registered with the SEC.
However, the judge ruled that regardless of whether the assets were securities, Coinbase's user agreement "flatly contradicts" the suits claim that the firm holds title to the assets traded on its exchange.
The judge dismissed the case with prejudice, noting that "granting leave to amend would be futile" because the plaintiffs have already made amendments "by adding numerous allegations that directly contradicted their initial complaint".
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