Coinbase demands Gensler's private emails in SEC battle over crypto rules
Last month, the exchange requested the SEC Chairman to produce certain communications, including emails, reflecting his views on digital assets from 2017 to the present.
The SEC challenged this move, citing concerns over burden and privacy intrusion. The regulator argued that any subpoena should target the commission as an institution, not Gensler personally. The regulator stated:
“To the extent it is not, it is an improper intrusion into a public official’s private life, based on his decision to serve. Given also the utter lack of relevance of the requested documents, and the potential chilling effect on public service, the Court should quash the Subpoena and issue a protective order.”
Why Coinbase wants Gensler’s emails
In response, Coinbase described the SEC’s argument as unfounded, noting that its request was pertinent to understanding the Chairman’s views on digital assets and federal securities laws.
Coinbase also highlighted Gensler’s communications with market participants as crucial for gaining insight into the agency’s stance on digital asset regulation. It stated:
“What Mr. Gensler was saying in his private communications about the regulatory status of digital assets, and what market participants were saying to him about these matters, is probative of the objective understanding of the public and market participants regarding what conduct the securities laws prohibit.”
Furthermore, Coinbase referenced the Ripple case precedent, noting that the Court confirmed that an agency personnel’s internal communications can provide essential insights, even if not publicly disclosed.
“As the Ripple court confirmed, a document or communication need not be public to provide insight into the public’s objective understanding as to what regulators require of them.”
The Brian Armstrong-led exchange furthered that the Court should allow its request because Gensler, before his confirmation as SEC Chair, had “shaped and reflected the public’s understanding” of the commission’s regulatory efforts on digital assets.
Considering this, Coinbase stated that:
“It should hardly be surprising that he might be subject to discovery in an action brought by the SEC — especially where, as here, Mr. Gensler has been a key public voice on the regulatory status of the digital asset industry.”
