Coinbase has submitted lawsuits against the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC), accusing the agencies of trying to cripple the crypto industry.
BREAKING: 🇺🇸 COINBASE SUES SEC, CLAIMING REGULATORS ARE TRYING TO CRIMP CRYPTO INDUSTRY. pic.twitter.com/bD1B1Vny1r
— Bitcoin Magazine (@BitcoinMagazine) June 27, 2024
The lawsuits, filed June 27 in Washington DC District Court, allege the second and FDIC did not comply with Coinbase’s Freedom of Information Act (FOIA) requests. Coinbase says this information could shed light on coordinated efforts by regulators to restrict crypto’s access to banking services.
In its complaints, Coinbase alleges that federal regulators are deliberately campaigning to cut off Bitcoin and crypto companies from the banking system, posing an existential threat to the sector as it strangles vital financial lifelines.
Coinbase points out that regulators are pressuring banks to deny accounts and services to Bitcoin and crypto companies. It compares this to “Operation Choke Pointt,” an Obama-era initiative that discourages banks from working with certain “risky” industries.
The exchange claims that regulators are violating transparency laws to hide the full extent of their crypto suppression. Coinbase aims to expose regulatory overreach, which it says far exceeds agency mandates.
However, legal experts warn that FOIA lawsuits are an uphill battle, given agencies’ broad discretion over disclosure exemptions. Proving malicious intent by regulators can also prove difficult.
Still, the cases represent Coinbase’s latest pushback against regulators like the SEC, with whom it has already engaged in multiple legal battles. The exchange is defending the Bitcoin and crypto industry from regulatory hostility that threatens its viability.
Coinbase’s allegations resonate with Bitcoin and crypto advocates who believe regulators are abusing their powers to intentionally slow technological progress.