YEREVAN (CoinChapter.com) — On March 27, 2025, South Carolina dismissed its lawsuit against Coinbase over the exchange’s staking services. This dismissal follows Vermont’s earlier decision to drop its own similar lawsuit. Coinbase faced accusations of offering unregistered securities through its staking offerings, but the legal actions from the states have now been dismissed.
South Carolina Joins Vermont in Dismissing Lawsuit Against Coinbase
The lawsuit filed by South Carolina was dismissed in a joint stipulation between Coinbase and the South Carolina Attorney General’s securities division. This marks a key moment in the legal dispute over staking services. Coinbase’s Chief Legal Officer, Paul Grewal, praised the dismissal, viewing it as a victory for consumers and signaling that the legal landscape for staking may be shifting.
South Carolina and Vermont were among the ten states that filed lawsuits against Coinbase on June 6, 2023, accusing the exchange of violating securities laws by offering staking without proper registration. These actions came on the same day that the U.S. Securities and Exchange Commission (SEC) filed its own lawsuit against Coinbase. The SEC’s case was dismissed in February 2025, but legal action by state governments, including South Carolina, continued until recently.
Impact of South Carolina’s Dismissal on the Lawsuits
The dismissal of the South Carolina lawsuit marks a significant step in the ongoing legal battles over staking services in the U.S. In total, South Carolina was one of ten states to pursue similar legal actions, including Alabama, California, Illinois, Kentucky, Maryland, New Jersey, Washington, and Wisconsin. Following South Carolina’s decision, Coinbase expressed its hope that other states with staking restrictions would also reconsider their legal actions.
Coinbase reported that South Carolina residents lost an estimated $2 million in staking rewards due to the ongoing lawsuit. Paul Grewal emphasized that the outcome benefits Americans involved in cryptocurrency. Coinbase hopes the dismissal will set a precedent for other states that still restrict staking services.
South Carolina Introduces Bitcoin Reserve Bill
In a related development, a new bill, the Strategic Digital Assets Reserve Act of South Carolina, was introduced on March 27, 2025. This bill allows the state’s treasurer, Curtis Loftis, to allocate up to 10% of certain state funds to digital assets such as Bitcoin. The bill allows for the creation of a Bitcoin reserve, setting a ceiling of 1 million Bitcoin in state funds.
This move is part of a broader trend in U.S. states, with 42 Bitcoin reserve bills already introduced across 19 states. The introduction of the bill shows South Carolina’s continued interest in digital assets, particularly Bitcoin, as a potential asset class for state investments.
Broader Context of State-Level Crypto Legislation
South Carolina’s recent actions include dismissing the Coinbase lawsuit and introducing the Bitcoin reserve bill. These moves reflect a growing interest in cryptocurrency regulation at the state level. Some states have taken legal action against Coinbase. Others have introduced bills to regulate and integrate cryptocurrency into their financial systems.
The legal landscape surrounding staking services continues to evolve. Some states are taking action to restrict or regulate staking, while others seek clearer rules for digital assets.
According to Bitcoin Law, 42 Bitcoin reserve bills have been introduced across 19 U.S. states, with 36 of those bills still active.
Earlier this month, U.S. President Donald Trump signed an executive order. Specifically, the order aims to establish a Strategic Bitcoin Reserve and a Digital Asset Stockpile. Initially, these reserves would be funded by cryptocurrency forfeited or seized in government criminal cases.
