u.today
Coinbase exchange has filed a fresh lawsuit against the United States Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Commission (FDIC).
Coinbase claims
According to the trading platform, these government agencies are deliberately crushing out crypto firms from the financial ecosystem. The trading platform specifically said financial regulators are pressuring banks not to provide services to crypto firms.
"Financial regulators have used multiple tools at their disposal to try to cripple the digital-asset industry. @SECGov has claimed sweeping authority, but refuses to provide any rules, let alone consistent or coherent ones," Coinbase Chief Legal Officer Paul Grewal said in a post on X.
We asked the SEC for documents about closed investigations to shed light on how the SEC views its newfound, sweeping (and unlawful) authority. One of those investigations, which only recently closed, focused on ETH, which the SEC publicly announced is not a security in 2018. And…
— paulgrewal.eth (@iampaulgrewal) June 27, 2024
On the part of the FDIC, Grewal said the primary goal has been to cut crypto off from the banking system. This was showcased in the past in a case between Custodia Bank and the Federal Reserve. The banking regulator denied the crypto bank’s application for a Master Account that could help it offer basic banking services directly.
As Paul Grewal noted, the firm asked the SEC for information on cases that might have given it the authority it has to maintain the kind of authority it currently wields. As he noted, the SEC has failed to respond to these requests even though one of the requests is linked to the recently closed Ethereum securities case.
FDIC refuses to play ball
Besides the SEC, the FDIC also violated the Freedom of Information Act (FOIC) when it failed to provide the letters it sent to financial institutions, asking them to indefinitely “pause” crypto-related activities.
Grewal observed that this was "an action that the FDIC’s own Office of Inspector General criticized for creating a 'risk that the FDIC would inadvertently limit financial institution innovation and growth in the crypto space.'"
This new lawsuit adds to two others that Coinbase is embroiled in with the SEC. The biggest is related to the securities token trading on its platforms.