Coinbase Pursues Transparency on SEC’s Expenditure in Crypto Regulation
Coinbase Inquires into SEC’s Financial Expenditure on Crypto Regulation
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On a recent Monday, Paul Grewal, the Chief Legal Officer at Coinbase, publicized the company’s initiative to file a Freedom of Information Act (FOIA) request. This request aims to unveil the financial resources the Securities and Exchange Commission (SEC) has allocated towards enforcement actions targeting cryptocurrency firms. The inquiry specifically seeks clarity on the taxpayer dollars consumed by the SEC’s regulatory activities, often perceived as “regulation by enforcement.”
Coinbase’s legal team has conducted a thorough review of several SEC Congressional reports, such as the Fiscal Year 2025 Congressional Budget Justification (CBJ) and the Fiscal Year 2023 Annual Performance Report (APR). The company is requesting access to the documentation that supports these reports to gain insight into the SEC’s historical and current financial allocations.
Coinbase’s Call for Information on Crypto-Related Investigations
In a detailed discussion on social media, Grewal engaged the Elon Musk-initiated US Department of Government Efficiency (DOGE). Here, Coinbase expressed the need to understand the volume and financial impact of investigations and enforcement actions concerning cryptocurrency, specifically those initiated between April 17, 2021, and January 20, 2025.
Moreover, Coinbase seeks to learn about the workforce involved in these regulatory activities, including both SEC employees and third-party contractors. The company is particularly interested in the operations of the SEC’s “Crypto Assets and Cyber Unit” within its Enforcement Division.
SEC’s Crypto Enforcement Unit Undergoes Changes
The specialized crypto enforcement unit has reportedly seen significant restructuring since the new administration’s commencement. Notable media sources suggest that the SEC is redistributing the unit’s personnel to other departments, indicating a shift in focus. Initially established in 2017 under the previous administration, this unit was tasked with industry-specific enforcement actions. Under Gary Gensler’s leadership, the unit expanded in May 2022, growing to nearly 50 dedicated positions, and undertook over 100 crypto-related enforcement actions during the Biden administration.
Anticipated Delays in Gaining Comprehensive Understanding
With Gensler’s exit and a more crypto-friendly administration in place, the SEC is reportedly revising its approach to be more accommodating towards the industry. On January 21, the agency introduced the Crypto Task Force, spearheaded by SEC Commissioner Hester Peirce, aiming to establish a clear regulatory framework. Subsequently, the Commission has ceased several prominent crypto litigations and concluded numerous investigations without proceeding with enforcement actions.
Recently, the SEC officially withdrew its lawsuit against Coinbase, a decision celebrated by the company as a triumph for its customers and broader individual liberties. Grewal advocated for definitive crypto legislation to thwart “rogue attacks” and emphasized holding the SEC accountable for politically motivated enforcement actions of the past.
In closing his social media discourse, Coinbase’s CLO acknowledged that achieving a complete understanding of the SEC’s “war on crypto” might be protracted. He assured customers and the crypto community of Coinbase’s unwavering commitment to promoting government transparency and pledged relentless efforts to uncover the truth.
Currently, Bitcoin (BTC) is trading at $83,142 according to the weekly chart.
