Coinbase Takes Legal Action Against Dynapass Patent Claims
Coinbase has taken a bold step by filing a lawsuit against Dynapass Inc., challenging the validity of a patent related to two-factor authentication and asserting that the claims made by the company are unfounded.
On September 3, 2025, Coinbase Inc. lodged a complaint in the U.S. District Court for the Central District of California against Dynapass Inc. and its affiliate Dynapass IP Holdings. The purpose of this legal action is to obtain a declaratory judgment stating that Coinbase has not infringed on U.S. Patent No. 6,993,658 and that the patent itself is no longer enforceable.
The dispute arose following a letter dated July 18, in which Dynapass alleged that Coinbase had violated the patent by utilizing two-factor authentication (2FA) for user accounts. Dynapass claimed that Coinbase had been using technology covered by the patent since 2018 and demanded compensation for damages, citing previous successful enforcement actions against other companies.
In response, Coinbase refuted these allegations on August 1, arguing that the patent had expired in March 2020 and that the U.S. Patent and Trademark Office had invalidated one of its key claims in 2024. Additionally, Coinbase contended that the patent did not meet the criteria set forth by the U.S. Supreme Court’s Alice test, which prohibits patents that merely cover abstract ideas without substantial innovation.
Paul Grewal, Chief Legal Officer of Coinbase, publicly addressed the case in a post on X, emphasizing the company’s stance on patent disputes. “We do not entertain baseless claims; instead, we opt to take legal action,” Grewal stated, underscoring Coinbase’s commitment to challenging what it perceives as patent trolling.
The lawsuit filed by Coinbase underscores its unwavering stand against settling dubious claims. Grewal portrayed this legal battle as part of Coinbase’s broader strategy against entities that engage in patent litigation or seek licensing fees without contributing to technological advancements.
The litigation also sheds light on the ongoing tensions within the tech industry regarding patents associated with security protocols like 2FA. Coinbase argues that recognizing expired or overly broad claims could have far-reaching implications for authentication practices widely adopted across various sectors.
As of early September, the legal proceedings are still in their nascent stage, with no imminent hearings or judgments scheduled.