Coinbase has asked a federal court to force the U.S. Securities and Exchange Commission (SEC) to produce text messages from former chair Gary Gensler, alleging the agency permanently deleted nearly a year of communications during a critical period for crypto enforcement.
The request follows a report from the SEC’s Office of the Inspector General that found messages dated between October 2022 and September 2023 were erased. According to the IG, the agency has a policy that remotely wipes devices no longer connected to the SEC network after 45 days — a practice that appears to have led to the loss of Gensler’s texts.
In court papers, Coinbase — working with independent researchers at History Associates — asks the U.S. District Court for the District of Columbia for expedited discovery, sanctions, and immediate production of any responsive communications. Coinbase Chief Legal Officer Paul Grewal highlighted the IG findings publicly and called the deletions proof the SEC failed to preserve required records.
The deletion window overlaps with major crypto events, including the FTX collapse and the SEC’s intensified enforcement activity. Coinbase had sought internal communications via Freedom of Information Act requests about Ethereum regulation and other digital-asset policy decisions; the agency initially refused under law-enforcement exemptions before Coinbase sued in June 2024.
The Inspector General also flagged potential record losses on devices from more than 40 other senior SEC officials, with 21 devices identified as confirmed or suspected instances of data destruction.
Industry voices warn the implications could be far-reaching. Some experts say the alleged deletions create a credibility problem for the SEC that could let defendants challenge the agency’s evidence and slow or complicate enforcement actions. Others note that if sanctions are imposed, it could set a legal precedent affecting how courts view the SEC’s internal recordkeeping.
Why it matters: beyond this single dispute, the episode raises questions about transparency and procedures at the agency responsible for policing crypto markets. If key records are unavailable, ongoing enforcement and regulatory clarity could be delayed, creating additional legal and compliance risk for firms and regulators alike.
Source: Decrypt. Read the original coverage for full details.