Regulation
Coinbase Sues SEC, FDIC Over Cryptocurrency Rules
Cryptocurrency exchange Coinbase filed a lawsuit against the U.S. Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC) on Thursday, alleging unfair targeting and opaque practices.
The lawsuits, filed in the U.S. District Court for the District of Columbia, accuse the agencies of overregulation and failure to respond to Freedom of Information Act (FOIA) requests.
The exchange’s lawsuit seeks to counter what it sees as a concerted effort by the SEC and FDIC to undermine the cryptocurrency industry by restricting access to banking services and withholding information.
Coinbase has criticized the SEC for using privacy claims to hide its regulatory methods, particularly regarding the proof-of-stake transition of Ethereum and other cryptocurrencies.
The FDIC is also under fire for advising banks to halt the expansion of cryptocurrency-related services through “cease letters,” a tactic that Coinbase likens to the controversial “Operation Choke Point.”
Coinbase’s dispute with the SEC also includes an earlier lawsuit from April 2023, in which the exchange requested a definitive position on cryptocurrency-specific regulations.
Despite discussions that began in July 2022, the SEC has yet to provide clear guidance, opting to apply existing securities laws that Coinbase says are unsuitable for cryptocurrencies.