Regulation
Coinbase Subpoena for SEC Chair Gensler
Coinbase Vs. SEC Lawsuit: Coinbase has reduced the scope of the subpoena served to SEC Chair Gary Gensler and is only seeking documents from when he was chair. This move comes after a New York judge questioned the breadth of the initial subpoena that was issued.
Coinbase Refines Subpoena for SEC Chair Gensler
Coinbase, a crypto exchange, has changed its legal approach in the ongoing legal battle with the U.S. Securities and Exchange Commission (SEC). The company has narrowed down the subpoena concerning SEC Chair Gary Gensler to ask for documents from his tenure at the SEC only. This came after a New York judge worried over the breadth of the initial demand that covered messages from 2017 up to the present.
New minute entry in SEC v. Coinbase: Minute Entry for proceedings held before Judge Katherine Polk Failla: Pre-Motion Conference held on 7/11/2024. Attorneys Jorge Gerardo Tenreiro, Nicholas Margida, Patrick…
[full entry below 👇]
Docket: https://t.co/xzF4ofOHTw#CL67478179 pic.twitter.com/YO1WTtAhzO
— Big Cases Bot (@big_cases) July 15, 2024
The original subpoena was delivered in June and sought communications concerning Gensler’s prior comments on cryptocurrency prior to his becoming SEC chair in 2021.
However, in a recent court filing, Coinbase has opted to narrow down its demand to only Gensler’s time as the SEC Chair. This change was conveyed by the company’s lawyer in a scheduling order filed on Monday.
Judge’s Concerns Prompt Changes
U.S. District Judge Katherine Polk Failla had some concerns about the scope of Coinbase’s first subpoena. Speaking during a pre-trial motion conference on July 11 th, she stated that she was not persuaded by Coinbase’s arguments especially those concerning Gensler’s private conversations on cryptocurrencies.
Judge Failla suggested that Coinbase should concentrate on facts related to Gensler’s function as SEC chair, which led to the change of strategy.
The lawyer representing Coinbase stated that they would be filing a motion to compel the SEC to provide the requested documents with an opening brief set for July 23. The SEC has fought the subpoena and called it an overreaching intrusion into Gensler’s private life.
SEC’s Recent Regulatory Stances
The ongoing court battle between Coinbase and the SEC is just a part of the broader fight for regulation in the crypto market. The SEC’s complaint against Coinbase is that the exchange functioned as an unregistered broker and dealer as well as an unregistered clearing agency. Coinbase’s motion to dismiss the lawsuit was denied in March, although one of the claims related to the company’s Wallet application was dismissed.
At the same time, Elizabeth Goody became the SEC’s lawyer in that case against Coinbase. This addition happens at the same time when the SEC finishes investigations into a number of crypto companies, including Consensys, Paxos, and Hiro and does not demand enforcement actions. These changes have also led to different speculations in the cryptocurrency market concerning the current position of the SEC on Crypto.
Paul Grewal, Coinbase’s Chief Legal Officer, has stated that the recent actions by the SEC may indicate that the regulator is open for dialogue with the crypto industry. According to Coingape, Grewal stated that the SEC may very well be prepared to come to the table with the industry and work with it, as opposed to striking against it through enforcement actions.
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