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28/06/24
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Coinbase Files Lawsuit Against U.S. SEC and FDIC
Crypto exchange Coinbase has reportedly filed lawsuits against the U.S. Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC) on June 27, according to a report by FoxBusiness.
Coinbase claimed that both governmental authorities did not comply with Freedom of Information Act (FOIA) requests submitted to the United States District Court for the District of Columbia. The federal agencies allegedly attempted to exclude the cryptocurrency industry from the banking sector.
The crypto exchange accused them of being unable to provide documents under open-records laws that would reveal the SEC’s views on crypto. Coinbase wants to see written communications in three closed cases regarding how the commission formally worked out what digital assets it thinks qualify as securities, including ETH.
Likewise, it wants to see copies of the “pause letters” sent by the FDIC to financial companies asking them to halt cryptocurrency activity. The legal challenge ensued after the SEC reportedly ended a review of Ethereum 2.0 as a potential security.
Further, Coinbase wants to see documents related to two previously settled digital asset cases, including one involving Zachary Coburn and the other involving Enigma MPC. Zachary Coburn established a platform which acted as a market for ETH and the commission considered ETH “digital asset securities” in a lawsuit against the platform six years ago. Enigma MPC sold ENG tokens worth $45M seven years ago and the commission claimed that the tokens were unregistered securities.
“For nearly two years, a wide array of federal financial regulators—including the Securities and Exchange Commission (“SEC”), the FDIC, and the Federal Reserve Board — have used every regulatory tool at their disposal to try to cripple the digital-asset industry. This FOIA lawsuit seeks to bring to light the FDIC’s role in that unlawful scheme,” reads the filing.
In the words of Coinbase’s chief legal officer Paul Grewal via X, “Financial regulators have used multiple tools at their disposal to try to cripple the digital-asset industry. […] This is no way to regulate. And this is no way to operate a transparent government.”
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