Coinbase Accuses SEC of Damaging Public Trust Over Deletion of Gensler Texts as part of a newly filed lawsuit, asserting that the regulator violated the Freedom of Information Act (FOIA) and deliberately eliminated key communications that would clarify its enforcement strategies.

Coinbase Accuses SEC of Damaging Public Trust Over Deletion of Gensler Texts

In its court filing on Tuesday, Coinbase detailed how the SEC failed to honor previous orders to disclose correspondence concerning Ethereum and other digital assets. The accusation suggests that this non‑compliance has sparked a broader “credibility crisis,” potentially undermining the agency’s authority in future regulatory actions.

The company argues that the SEC’s omissions obstructed a full review of essential documents, which could have shaped public perception of the agency’s decision‑making process.

In a recent post on X, Coinbase’s chief legal officer, Paul Grewal, declared, “The Gensler SEC destroyed documents they were required to preserve and produce. We now have proof from the SEC’s own Inspector General. Today, we ask the federal court to address this gross violation of public trust to ensure that it never happens again.”

What Happened Between Coinbase and the SEC?

On September 3, the SEC Office of Inspector General released a report revealing the deletion of a year’s worth of text messages from former SEC Chair Gary Gensler. Those messages reportedly contained pivotal information about the FTX collapse and critical enforcement actions involving Coinbase.

The deletion followed Coinbase’s FOIA request, which sought all communications related to crypto regulatory decisions. This action raised alarm about the SEC’s stewardship of records and its broader compliance culture.

Coinbase’s Demand Against the SEC 

Coinbase now seeks court‑imposed sanctions against the SEC for mishandling critical records and demands expedited discovery to determine the extent of document destruction.

The company also highlighted a perceived double standard, noting, “Considering the double‑standards of the previous Chair, it’s not surprising that the same agency that fined firms billions for record‑keeping failures committed the exact same violations.”

Coalescing its arguments, Coinbase contends that the SEC failed to disclose the deletion of texts in a timely manner, thereby damaging public trust and causing irreparable harm. The company requests that the court hold the SEC accountable for these actions.

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