Coinbase Demands Transparency from the SEC on Enforcement Spending
As the dust settles on its recent enforcement case, Coinbase, the largest cryptocurrency exchange in the United States, is taking a bold step by requesting the U.S. Securities and Exchange Commission (SEC) to disclose detailed records of its expenditures related to investigations and actions against the broader cryptocurrency industry over the past several years. This initiative involves a Freedom of Information Act (FOIA) request, facilitated by Coinbase’s contractor, History Associates Inc.
The request aims to uncover crucial information, including the total costs incurred for investigations and enforcement actions over the last four years, a comprehensive list of targeted companies, the number of employees and contractors involved in these cases, and financial details regarding the operations of the previous leadership’s crypto enforcement unit.
Significantly, the SEC has experienced a change in leadership since the inauguration of President Donald Trump, who appointed Commissioner Mark Uyeda as acting chairman. Uyeda has initiated a considerable shift in the agency’s approach to cryptocurrency, which has included replacing legal officials, halting ongoing investigations, and dismissing protracted court cases, notably the one against Coinbase itself.
In an interview with CoinDesk, Coinbase’s Chief Legal Officer, Paul Grewal, stated, “We’re asking the SEC to produce this information voluntarily and in accordance with their FOIA obligations, without forcing Coinbase or any other party to resort to legal action to obtain what we believe the American public deserves to know.”
This is not the first time Coinbase has engaged the SEC in federal court over public records disputes. The company is still actively pursuing transparency regarding the regulator’s internal communications about its oversight of cryptocurrencies. While the SEC has recently alleviated enforcement actions against digital asset businesses, many industry advocates are calling for accountability concerning the SEC’s past conduct under Chair Gary Gensler, including demands for the dismissal of certain staff involved in controversial decisions.
Grewal emphasized that this records request is not an act of retaliation but rather an essential move towards transparency. “This is not merely about Coinbase or any other entity celebrating a victory or attempting to highlight the SEC’s acknowledgment of errors made over the last four years,” he remarked. “This is fundamentally about learning from history to ensure that we do not repeat the same mistakes in the future.”
While the public has a legitimate right to access government documents, the process for obtaining such information is often fraught with challenges, including agency roadblocks that can lead to lengthy delays. The SEC, for instance, can invoke exceptions for ongoing cases, which still include several crypto-related matters involving companies like Kraken, Ripple, and Crypto.com. However, Grewal argued that closed cases, such as Coinbase’s, along with others recently receiving favorable outcomes, should be open to public scrutiny.
“Let’s bring the facts to light,” Grewal asserted. “Let’s account for the expenditures involved. Let’s evaluate whether there were any measurable benefits as well. Ultimately, we need to determine whether this approach aligns with our nation’s values and economic goals, and how we can establish rules to prevent such occurrences in the future.”
