Coinbase Sues SEC, FDIC for Records on Crypto Trade Policing (1)
History Associates Inc., a consultant hired by Coinbase for the records requests, brought one suit Thursday against the Securities and Exchange Commission for documents related to three crypto investigations, hoping for details about how the securities regulator views its crypto authority.
A second case against the Federal Deposit Insurance Corp. is seeking to force the banking regulator to turn over letters it purportedly sent to banks asking them to pause crypto-related activities.
“Financial regulators have used multiple tools at their disposal to try to cripple the digital-asset industry,” Coinbase’s chief legal officer, Paul Grewal, said Thursday on X. “Today we filed lawsuits under the Freedom of Information Act for requests we made over a year ago seeking important information to which we, and the public, are entitled,” he added.
Both cases were filed in the US District Court for the District of Columbia. The SEC declined to comment. The FDIC didn’t immediately respond to a request for comment.
‘No Way to Regulate’
Coinbase, which has been sued by the SEC and accused of illegally operating an unregistered securities exchange, has been aggressive in taking the agency to court, including seeking to force the SEC to write new rules around trading assets.
The FOIA case is seeking SEC records related to the agency’s review of Ethereum. SEC Chair Gary Gensler views most tokens as securities, but has been ambiguous on whether Ether is a security.
Coinbase also wants a judge to order the SEC to hand over records related to investigations involving Zachary Coburn and Enigma MPC.
Coburn, the founder of the EtherDelta trading platform, settled with the SEC in 2018. It was the first case based on findings that such a platform operated as an unregistered securities exchange. Enigma MPC, a blockchain startup, settled claims in 2020 that it sold unregistered securities.
Coinbase requested the records “with the goal of divining how the SEC views its newfound, sweeping, and unlawful authority” over crypto, the lawsuit said. The SEC has denied the requests because they may relate to pending investigations, the complaint said.
The exchange also wants letters the FDIC’s Office of Inspector General said were sent in 2022 and 2023 to certain financial institutions, asking them to pause crypto-related activities. Coinbase argues the letters are part of the FDIC’s effort to cut off crypto firms from banking services.
“This is no way to regulate,” Grewal said in X. “And this is no way to operate a transparent government.”
History Associates is represented by Gibson Dunn & Crutcher LLP.
The cases are History Associates Inc. v. SEC, D.D.C., No. 24-cv-1858, 6/27/24 and History Associates Inc. v. FDIC, D.D.C., No. 24-cv-01857, 6/27/24.
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