Coinbase, a leading US cryptocurrency exchange, is disputing the SEC’s refusal to provide access to private emails from its chairman, Gary Gensler. In a letter to District Court Judge Katherine Polk Failla, Coinbase argued that Gensler’s emails are essential for its defense in an ongoing lawsuit. The Exchange believes these communications are crucial for understanding the SEC’s regulatory stance on digital assets.
In April, Coinbase demanded that Gensler produce documents related to his communications, along with all SEC documents regarding cryptocurrency dating back to 2017. Coinbase contends these materials are necessary to determine if the SEC provided adequate fair notice in its enforcement actions.
However, the SEC opposed this request, arguing that it is irrelevant to the case, imposes an undue burden, and disincentivizes public service. The SEC also labeled the request as an improper intrusion into Gensler’s private life and asked the court to dismiss Coinbase’s subpoena.
Coinbase’s defense emphasizes that Gensler’s communications about digital assets and crypto exchange oversight are vital for its fair notice defense. The exchange argues that Gensler’s private communications contain his views on the regulatory status of digital assets, which are essential to the case.
Coinbase highlighted Gensler’s 2021 testimony before Congress, where he mentioned the absence of a regulator for cryptocurrency exchanges and suggested that only Congress could enforce investor protection.
Coinbase claims that Gensler has made numerous public and private comments on digital assets’ regulatory status, both before and during his tenure as SEC chair. Gensler’s previous roles, including CFTC chairman and MIT lecturer on blockchain technology, have significantly influenced public understanding of crypto regulations. Coinbase believes that Gensler’s commentary on digital assets in various forums supports its defense.
Paul Grewal, Coinbase’s chief legal officer, commented on the SEC’s efforts to block reasonable discovery in the legal battle it initiated. Grewal emphasized that Coinbase’s requests are in response to the SEC’s actions and that fair process must be upheld.
The SEC had filed a lawsuit against Coinbase in June 2023, accusing the exchange of listing unregistered securities and operating as an unregistered securities broker. Coinbase maintains that the tokens in question are not securities and fall outside the SEC’s regulatory jurisdiction.
