US-based crypto exchange Coinbase, is intensifying its legal battle against the US Securities and Exchange Commission (SEC) to access crucial documents regarding the regulatory framework governing cryptocurrencies.
On Tuesday, the exchange requested a court order to compel the SEC to produce internal records that could clarify how securities laws apply to digital assets.
Coinbase Demands Immediate Access To SEC Records
The conflict centers around a Freedom of Information Act (FOIA) request submitted by History Associates on behalf of Coinbase. The SEC previously denied this request, claiming it fell under FOIA Exemption, which applies to records compiled for ongoing law enforcement proceedings.
However, after the lawsuit was filed, the SEC conceded that this exemption “may no longer apply” due to unspecified developments. Still, the company claims that the regulator has not acted to release the documents.
Instead of complying with its obligations, Coinbase claims that the SEC is now insisting on a complete re-evaluation of the documents, which it claims could take up to three years. This protracted process has prompted History Associates to seek partial summary judgment to expedite access to the requested records.
The documents in question include those related to Ethereum’s transition to a proof-of-stake (PoS) consensus mechanism and investigatory files concerning Enigma MPC and Zachary Coburn—both of which had previously settled claims with the SEC.
CLO Questions SEC’s Motives
The firm further disclosed in the document filed on Tuesday that the SEC’s response has been minimal, providing only three redacted pages and maintaining that other records are being withheld under the same exemption.
History Associates argues that under FOIA, agencies must disclose responsive records unless they can demonstrate that they fall within specific statutory exemptions.
The SEC’s reliance on Exemption 7(A) is now being challenged, particularly as it has not established that any other exemptions would apply. The agency’s delay in processing the requests is viewed as a violation of FOIA’s intent, which mandates timely disclosure of records.
In parallel, Bitcoinist previously reported that the SEC sought a time extension to complete the discovery phase in its ongoing case against Coinbase, citing the need to review additional documents related to a prior court order.
This request came after the SEC produced hundreds of thousands of documents but indicated that further scrutiny was necessary due to newly agreed-upon terms with Coinbase.
Coinbase’s Chief Legal Officer also criticized the SEC’s handling of the FOIA requests on Tuesday, stating that the SEC’s shifting rationale raises questions about what the agency is concealing:
Over a year ago, we made FOIA requests aimed at files on ETH 2.0 and other mysteries that belong to all of us, not the SEC. Their constantly changing story begs the question: what is the SEC hiding and why?
At the time of writing, the exchange’s stock, which trades under the ticker COIN, has risen above the $200 mark for the first time since late August.
Featured image from DALL-E, chart from TradingView.com
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