Coinbase is asking a U.S. court to rule on its request for documents from the Securities and Exchange Commission (SEC) concerning how securities laws apply to cryptocurrencies, particularly regarding ether.
The legal move comes as America’s largest crypto platform continues to seek transparency on the SEC’s stance on whether ether and other digital assets should be classified as securities.
Coinbase filed a motion with the U.S. District Court for the District of Columbia, requesting a partial summary judgment in a case that stems from its June lawsuit against the SEC and the Federal Deposit Insurance Corporation (FDIC). The lawsuit was filed in response to the agencies’ refusal to comply with a Freedom of Information Act (FOIA) request. It seeks access to internal and external communications related to the SEC’s investigations into whether certain cryptocurrencies, including ether, are securities.
The classification of ether as a security or not has become a critical issue for the cryptocurrency industry. Blockchain firm Consensys previously raised the same question in a lawsuit against the SEC, following the commission’s investigation into Ethereum 2.0 in March 2023. Although the SEC eventually closed that investigation, the broader debate remains unresolved.
Coinbase’s lawsuit seeks documents about two now-closed SEC investigations involving Enigma MPC, a data encryption startup, and Zachary Coburn, the creator of Ether Delta, a platform the SEC deemed an unregistered exchange. Both settled their cases with the SEC in prior years.
The SEC has pushed back on Coinbase’s FOIA request, initially claiming exemptions from the law but recently suggesting otherwise. According to Coinbase’s Chief Legal Officer Paul Grewal, the SEC has now said it could take three years to produce the requested documents, further frustrating the exchange’s efforts to clarify regulatory guidelines.
In the complaint, History Associates Inc., a consulting firm working with Coinbase, criticized the SEC’s delays, stating: “Instead of promptly producing responsive documents, the SEC now insists it must start over and re-review the documents… and will not even begin that repeat review for three years.”
The case now hinges on whether the court will allow Coinbase to file a motion for partial summary judgment, which could push the SEC to release the documents sooner. Grewal noted that he does not expect a ruling on this matter before the end of the year.
Coinbase also sent FOIA requests to the FDIC, seeking information about the agency’s “pause letters” issued to financial institutions regarding crypto-related activities. These letters are part of what Coinbase has referred to as “Operation Choke Point 2.0”, but have raised concerns about regulatory pressure on financial institutions involved in cryptocurrency.
