Coinbase Changes Subpeona Tactics, Demands Gensler’s Private Emails During His Tenure as SEC Chair

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As part of its defense efforts in the ongoing SEC lawsuit, Coinbase subpoenaed SEC chairman Gary Gensler. In its subpoena, Coinbase sought access to Gensler’s private communications before and during his tenure as SEC Chairman.

However, in a new development, the crypto exchange has changed its approach and now demands only Gensler’s emails while serving as SEC chair. 

Coinbase’s Change in Subpoena Approach

In a previous letter addressed to Judge Katherine Polk Fialla, Coinbase argued that Gensler’s communication before and after becoming the SEC chair.  

However, the judge was reluctant to accept the crypto exchange’s request, prompting the recent change in tactics. According to a new letter filed on July 15, Coinbase now demands access to only communications during Gensler’s tenure as SEC chair. 

Part of the filing reads: “With respect to the subpoena to Mr. Gensler, Coinbase has determined to seek the production of Mr. Gensler’s documents only for the period of his tenure as Chair of the SEC and not before that time.”

Gensler assumed office as SEC chairman in April 2021. Before that, he started teaching Blockchain and Money at the Massachusetts Institute of Technology in 2018.  

In Coinbase’s initial subpoena, the exchange requested access to the SEC chairman’s private communications from 2017, before he started working at MIT. 

The crypto exchange mentioned that Gensler has a background in blockchain and digital assets and has made several public and private communications about crypto regulation.

Coinbase further argued that accessing these chats will aid in understanding Gensler’s views on crypto regulation and how they’ve changed over time.

In her response, Judge Failla expressed her apprehension about allowing Coinbase access to Gensler’s private emails before he became SEC chair. She described it as a “disproportionate burden of inquiry into Gensler’s statements.”

Moreover, the SEC opposed Coinbase’s previous request, asserting that it was irrelevant. The regulator described the move as one that “imposes an undue burden on the SEC and strongly disincentivizes public service.”

Per the latest filing, Coinbase’s opening brief in the case will be due by July 23. On the other hand, the SEC has until August 5 to file its opposition brief. Upon the SEC’s counter brief, Coinbase will have until August 12 to respond. 

Coinbase’s Battle with the SEC

In June last year, the US Securities and Exchanges Commission sued crypto exchange Coinbase for offering unregistered securities. The regulator argued that 13 tokens listed on Coinbase are securities. 

Also, the SEC accused the crypto exchange of operating as a securities broker since 2019, even before its IPO in April 2021, without due registration. 

Meanwhile, Coinbase asserts that tokens listed on its platform do not fall under securities law. Coinbase’s defense team accuses the SEC of overstepping its jurisdiction and cracking down on the crypto industry without providing clear regulatory guidelines.