Coinbase Files Dual FOIA Requests Demanding Transparency On US Crypto Crackdown

On Monday, Coinbase’s Chief Legal Officer, Paul Grewal, announced that the exchange is ramping up its legal efforts in their ongoing battle with US regulators by filing two new sets of Freedom of Information Act (FOIA) requests. 

Grewal emphasized the necessity of obtaining clarity on how regulatory agencies are approaching digital assets, stating, “In short, so long as the government will not relent, neither will Coinbase.”

Coinbase Aims To Reveal Crucial Regulatory Communications

The first FOIA request seeks documents relating to the cap on digital asset deposits imposed by the Federal Deposit Insurance Corporation (FDIC) and other banking regulators on financial institutions.

The second request aims to gather logs detailing how these agencies manage other FOIA requests. These new requests are distinct from prior FOIA filings made over a year ago, which are currently the subject of federal lawsuits.

Grewal’s recent post elaborated on the scope of the new requests, targeting all documents and communications exchanged between officials from various regulatory bodies, including the Treasury’s Office of the Comptroller of the Currency, the FDIC, and the Federal Reserve Board. 

These documents should pertain to any imposition of caps or restrictions on deposits from digital-asset companies at depository institutions like Signature Bank and Silvergate Bank, dating back to June 1, 2022.

The expansive definition of “documents” in the request covers a wide range of materials, including contracts, emails, meeting minutes, and any relevant communications, with the goal to uncover a comprehensive view of how regulators are dealing with digital asset deposit limits.

Clarity On Securities Laws Application

The conflict between the exchange and US regulators also dates back from a previous FOIA request submitted by History Associates on behalf of Coinbase, which the Securities and Exchange Commission (SEC) denied, citing FOIA Exemption that applies to records compiled for ongoing law enforcement proceedings.

In addition to the FOIA requests, Coinbase recently sought a court order to compel the SEC to produce internal records that could shed light on the application of securities laws to digital assets. 

This includes documents related to Ethereum’s transition to a proof-of-stake consensus mechanism and investigatory files concerning Enigma MPC and Zachary Coburn—both of which have settled claims with the SEC in the past.

Despite these efforts, Coinbase has expressed frustration with the SEC’s minimal response, which included only three heavily redacted pages, with the agency maintaining that other records are being withheld under the same exemption. 

History Associates, which is representing Coinbase in the FOIA matter, argues that under FOIA, agencies must disclose responsive records unless they can clearly demonstrate that they fall within specific statutory exemptions, to which the regulator’s response was a request for an extension of time.

At the time of writing, the exchange’s shares, COIN, are trading at $213.

Featured image from DALL-E, chart from TradingView.com