US-based cryptocurrency exchange giant Coinbase Believer A major legal win in its long-running battle with the Securities and Exchange Commission.

The exchange has been permitted to pursue an interlocutory appeal during the temporary stay of litigation before the district court.

"We appreciate the court's careful consideration. We will go to the Second Circuit," Paul Grewal, chief legal officer at Coinbase, said on social media while commenting on the ruling.

U.S. District Judge Katherine Polk Failla gave the green light to the interlocutory appeal because it “represents an overriding legal question” when it comes to the extent to which the Howey Test applies to cryptocurrencies. The judge indicated that there was a “substantial reason” for the difference of opinion.

The ruling stated that this important legal issue required the guidance of the Court of Appeals for the Second Circuit.

According to Judge Failla, an immediate interlocutory appeal would "materially enhance" the termination of the lawsuit because a significant portion of the SEC's claims against Coinbase could end up being dismissed.

As Jeremy Hogan, a partner at Hogan & Hogan, noted, this interlocutory appeal is granted "rare".

The litigation will be paused until the appeals court decides whether an “investment contract” requires an actual contract, according to Hogan.

Hogan also added that this is the main point of contention in Ripple's appeal.

"Huge congratulations to the Coinbase legal team. Not only will the Second Circuit consider dismissing the SEC case, but the lower court will temporarily stay it in the meantime. It's a huge win for the entire ecosystem," said Marco Santori, Chief Legal Officer at Kraken. On social media.

Despite the legal win, Coinbase (COIN) stock fell more than 8% amid a severe collapse in the cryptocurrency market.