The ongoing legal dispute between Coinbase and the U.S. Securities and Exchange Commission (SEC) is intensifying, as the regulatory body resists granting the cryptocurrency exchange access to the personal emails of SEC Chairman Gary Gensler.
Coinbase argues that Gensler’s emails could contain crucial information about the SEC’s stance on crypto regulation, which the company believes is essential for its defense in an upcoming trial.
Coinbase’s request is part of a broader strategy to gather evidence for a fair trial, focusing on whether the SEC adequately informed about the regulatory expectations for cryptocurrencies.
The SEC responded with a filing to the U.S. District Court for the Southern District of New York, opposing the request.
In a letter dated July 3, Coinbase’s legal team urged U.S. District Judge Katherine Failla to grant them access to Gensler’s emails.
The team emphasized that this communication could reveal Gensler’s personal views and interpretations of crypto regulations. This could be crucial in proving that Coinbase was not sufficiently informed about the SEC’s regulatory expectations.
Coinbase’s lawyers stressed that Gensler’s public statements and speeches, both in his official and personal capacities, could highlight inconsistencies or lack of clarity in the SEC’s stance on cryptocurrencies.
SEC Strictly Rejects the Request
In a filing to the U.S. District Court for the Southern District of New York, the SEC described Coinbase’s request as a misinterpretation of the disclaimer typically used in Gensler’s public speeches.
The SEC argues in the filing that Coinbase is requesting “irrelevant material.” The disclaimer states that the views expressed are personal and do not reflect the official stance of the Commission. The SEC argues that this neither means Gensler was speaking in a purely private capacity nor justifies the “intrusive” access Coinbase seeks to his personal communications.
The SEC emphasized that public speeches, even when given in a non-official setting, are still related to Gensler’s role as SEC Chairman and not merely personal opinions.
The SEC added that Coinbase’s rationale for investigating Gensler’s personal emails is not compelling and likely would not provide relevant information for the defense. They claim that any insights Gensler might have shared informally, such as at social events or in academic settings, would not support Coinbase’s claims of inadequate regulatory briefing.
Timeline of Charges Between Coinbase and SEC
- June 2023: The SEC charged Coinbase, claiming the company operated as an unregistered securities exchange, broker, and clearing agency. Coinbase vigorously denied these allegations.
- March: Coinbase sued the SEC for the denial of crypto rules, asserting that the regulatory body had hindered the industry’s development and clarity.
- April: Coinbase requested the release of documents from the SEC, followed by requests in June for documents from SEC Chairman Gensler relevant to the case. These include documents covering the period before Gensler took office on April 17, 2021.
- July: Coinbase’s legal team requested U.S. District Judge Katherine Failla to grant access to Gensler’s emails, arguing that the communications could reveal Gensler’s personal views on crypto regulation.
