Yesterday saw net inflows to BTC ETFs surge to their highest in two weeks (over $417mm)...

But this morning, Coinbase's motion to drop the SEC's case against the exchange was denied in court, allowing the regulator to proceed with its lawsuit.

As CoinTelegraph reports, a United States court has denied Coinbase's motion to dismiss the United States Securities and Exchange Commission's (SEC) case against the exchange.

The decision, made by U.S. District Judge Katherine Failla, allows the SEC to pursue its lawsuit against Coinbase, which alleges that the exchange operates as an unregistered exchange, broker, and clearing agency, according to March 27 court documents, that state:

"The Court finds the SEC has sufficiently pleaded that Coinbase operates as an exchange, as a broker, and as a clearing agency under the federal securities laws, and through its Staking Program engages in the unregistered offer and sale of securities."

The SEC sued Coinbase in June 2023 alleging that the crypto exchange violated federal securities laws by listing 13 tokens it alleged were securities.

The firm was seeking an order to drop the case, questioning the SEC's authority over crypto exchanges.

Decrypt explains why today's ruling matters:

Rulings on motions to dismiss, such as today's, are not resolutions of factual disputes. When evaluating such motions, federal judges only dismiss a case if there is not plausible evidence that a law has been violated, even when assuming all facts alleged by a plaintiff to be true.

In today's ruling, however, U.S. District Judge Kathleen Failla not only found most of the SEC's claims against Coinbase fit for trial, but also indicated support for the agency's broader, long standing argument about crypto: Many tokenized assets constitute securities schemes, and fall under the SEC's purview.