Coinbase sues SEC and FDIC, demanding transparency in cryptocurrency regulations

Coinbase has filed a lawsuit against the SEC and FDIC, accusing the agencies of restricting the cryptocurrency industry and seeking transparency under the Freedom of Information Act (FOIA).

Read on to learn more about this sensational event!

Coinbase disputes regulatory action

In a bold move, Coinbase Chief Legal Officer Paul Grewal announced on social media that the cryptocurrency exchange had filed lawsuits against the U.S. Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC). Legal action under the Freedom of Information Act (FOIA) aims to compel agencies to disclose information about their investigations and regulatory actions affecting the digital assets industry.

Charges against the SEC

Coinbase’s complaint highlights the SEC’s inconsistent and opaque position on the regulation of digital assets. The SEC, which declared in 2018 that Ether is not a security, has refused to provide clear guidance or modify its rules to accommodate digital asset companies. Instead, it engaged in what Coinbase describes as a “scorched earth enforcement war” aimed at crippling the industry. The lawsuit sought documents related to closed investigations, including Ether, to understand the current and past views of SEC regulators.

FDIC pressure on financial institutions

The lawsuit also targets the FDIC, alleging that the agency pressured financial institutions to stop cryptocurrency-related activities. The action, criticized by the FDIC Office of Inspector General, is seen as an attempt to stifle innovation and growth in the cryptocurrency sector. Coinbase demands that the FDIC release letters sent to banks that ordered them to stop working with cryptocurrency companies.

Legal bias of the lawsuit

The lawsuit, filed in the U.S. District Court for the District of Columbia, claims the SEC violated the FOIA Act by withholding records that should have been publicly available. The complaint alleges that the SEC’s refusal to release information about closed digital asset investigations is unjustified and makes it more difficult for the public and businesses to understand and comply with the regulations. Coinbase is represented by History Associates Incorporated, a consulting firm that specializes in obtaining records through FOIA requests.

Coinbase Complaint: Demanding Transparency and Accountability

Coinbase’s legal action highlights the need for transparency and fair regulation in the rapidly growing digital asset industry. The lawsuit calls on the SEC and FDIC to comply with FOIA, produce required documents, and ensure a clear and consistent regulatory framework. The outcome of this case could have significant implications for the future of cryptocurrency regulation in the United States.

Overall, Coinbase’s lawsuit against the SEC and FDIC highlights the ongoing fight for clear and fair regulation in the cryptocurrency industry. As the situation evolves, this could pave the way for greater transparency and a more supportive regulatory environment for digital assets.

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