Coinbase Officially Sues SEC and FDIC for Trying to Destroy the Crypto Industry

• Coinbase filed lawsuits against the SEC and FDIC for not complying with Freedom of Information Act (FOIA) requests
• Coinbase accused federal financial regulators of trying to cut off the crypto industry from the banking sector
• The FOIA requests sought information on the SEC’s view of Ether, closed investigations, and the FDIC’s pause letters to banks regarding crypto activities

Coinbase recently filed lawsuits against the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC) for not complying with Freedom of Information Act (FOIA) requests. Coinbase has accused the regulators of trying to cut off the crypto industry from the banking sector.

Background on FOIA Requests

FOIA requests allow the public to ask for records from any federal agency. Coinbase, which retained consultant firm History Associates Inc. to file the FOIA requests, is seeking information on several topics:

SEC Views on Ethereum

The requests asked for the SEC’s views on ether, following the SEC’s investigation into Ethereum 2.0. History Associates asked for records related to Ethereum’s shift to proof-of-stake.

Closed SEC Investigations

History Associates requested records from two now-closed SEC investigations – one involving Zachary Coburn and Ether Delta, and another involving data encryption startup Enigma MPC. The SEC denied releasing records, citing potential harm to ongoing cases.

FDIC “Pause Letters”

The requests asked for FDIC “pause letters” sent between March 2022 and May 2023 asking banks to not expand crypto activities. The FDIC denied releasing the letters, arguing it would reveal communications with specific banks.

Coinbase’s Reaction

In the lawsuits, Coinbase accused the agencies of violating FOIA obligations and trying to “cripple” the crypto industry by cutting off banking services. This follows Coinbase’s previous legal actions petitioning the SEC for clear crypto rules.

The lawsuits aim to force the federal regulators to release the requested information. The SEC and FDIC declined to comment on the pending litigation.

Conclusion

The FOIA lawsuits represent the latest escalation in the battle between Coinbase and U.S. financial regulators over crypto oversight. The outcome of the cases could shed more light on the agencies’ crypto positions. But the broader conflict over crypto regulation shows no signs of abating soon.