SEC settles with Coinbase over deleted Gensler texts

The SEC settled a FOIA lawsuit with Coinbase, paying $150,000 and updating its record-retention policies after deleting nearly a year of texts from former Chair Gary Gensler's phone.

The U.S. Securities and Exchange Commission (SEC) has settled a Freedom of Information Act (FOIA) lawsuit brought on behalf of Coinbase, agreeing to pay $150,000 and update its record-retention policies. The dispute arose after the SEC deleted nearly a year's worth of text messages from former Chair Gary Gensler's government-issued phone during a period of intense regulatory scrutiny of the crypto industry. Filed by History Associates in June 2024, the lawsuit followed the SEC's refusal to provide the requested records. An internal investigation revealed that Gensler's phone was wiped after it stopped syncing with the agency's management system, resulting in permanent data loss. The settlement, announced by Coinbase’s chief legal officer Paul Grewal, highlights ongoing concerns about regulatory transparency and double standards. Coinbase emphasized the impact of the missing records on public trust and information requests. The case also led to the dismissal of a separate SEC enforcement action against Coinbase.