In response to the SEC lawsuit, Coinbase has taken a strategic approach by subpoenaing SEC chairman Gary Gensler for his emails during his tenure, rather than his private communications before and after his appointment.
Originally seeking broader access, Coinbase narrowed its request amid judicial skepticism. The exchange’s revised stance aims to focus solely on Gensler’s communications while serving as SEC chair, potentially shedding light on his evolving views on crypto regulation.
Gary Gensler assumed the role of SEC chairman in April 2021, following his tenure as a professor at MIT specializing in blockchain and digital assets since 2018. Coinbase initially sought access to Gensler’s communications dating back to 2017, prior to his academic role.
Their argument emphasized Gensler’s background and public statements on crypto regulation, suggesting these communications could provide insights crucial to their defense.
Judge Katherine Polk Fialla expressed concerns over the breadth of Coinbase’s initial request, citing it as unduly burdensome and potentially irrelevant to the case.
The SEC also opposed the broad subpoena, labeling it as unnecessary and criticizing it for imposing excessive demands on the regulatory body. These objections prompted Coinbase to adjust its strategy, now focusing solely on Gensler’s communications during his tenure as SEC chair.
Coinbase faces legal challenges beyond its subpoena strategy. In June of the previous year, the SEC filed a lawsuit against Coinbase, alleging the exchange offered unregistered securities through 13 listed tokens and operated as a securities broker without proper registration since 2019.
Coinbase contests these claims, arguing that the tokens in question do not fall under securities laws and accusing the SEC of regulatory overreach and insufficient guidance for the crypto industry.
The legal proceedings are ongoing, with Coinbase required to submit its opening brief by July 23, followed by the SEC’s opposition by August 5 and Coinbase’s response by August 12.
The outcome of these filings will significantly influence the trajectory of Coinbase’s defense against the SEC’s allegations, shaping regulatory clarity for the broader cryptocurrency market.
