Coinbase, the largest cryptocurrency exchange in America, has taken legal action against the U.S. Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC) in an attempt to acquire documents related to the agencies’ efforts in regulating cryptocurrencies. The lawsuits were filed in a district court in Washington D.C., alleging that the SEC and FDIC have refused to comply with Coinbase’s requests made under the Freedom of Information Act (FOIA).
Coinbase argues that these agencies are pressuring banks to sever ties with cryptocurrency companies, a move that could potentially hinder the growth of the industry. This legal action mirrors concerns within the crypto sector regarding Operation Chokepoint 2.0, an initiative aimed at restricting crypto firms’ access to banking services.
Coinbase’s main objective is to obtain compliance from the SEC and FDIC by requesting that the court order the agencies to fulfill its FOIA requests. Specifically, Coinbase has sought information from the SEC regarding three crypto-related investigations conducted between 2018 and 2024. One of these investigations pertains to Ethereum (ETH) and its developer Consensys, following the SEC’s recent closure of its examination into Ethereum 2.0 without recommending any enforcement action. Coinbase is interested in understanding the SEC’s perspective on ETH, as outlined in its FOIA request.
Additionally, Coinbase has also submitted an FOIA request to the FDIC for information regarding the agency’s “pause letters.” These letters were sent to selected U.S. banks between March 2022 and May 2023, instructing them to refrain from engaging in crypto-related activities until the FDIC clarifies the risks associated with this asset class.
Coinbase claims that both the FDIC and SEC have denied its access to the requested information, citing concerns about jeopardizing ongoing enforcement investigations. Therefore, Coinbase is seeking court intervention to compel the agencies to comply with its FOIA requests.
Furthermore, apart from gaining access to the requested documentation, Coinbase hopes that this lawsuit will provide insight into the motives behind the SEC’s enforcement action against the exchange. The SEC has accused Coinbase of violating federal laws by facilitating the trading of securities, leading to an ongoing legal battle between the two parties in a New York federal court.
It is important to note that the information provided in this article is for informational purposes only and should not be considered as financial advice. The views expressed are solely those of the author and do not necessarily reflect the opinions of The Crypto Basic. Readers are encouraged to conduct thorough research before making any investment decisions, and The Crypto Basic bears no responsibility for any financial losses incurred.
