SEC Pays Coinbase $150K for Gensler's Ghost Texts — Receipts, Please

The U.S. Securities and Exchange Commission has agreed to pay Coinbase $150,000 to settle a two-year Freedom of Information Act lawsuit over internal documents the agency lost during former Chair Gary Gensler's tenure. The settlement, filed Wednesday, ends litigation in which Coinbase sought records to expose what it described as the SEC's "crypto by enforcement" approach during the Biden-era crackdown on digital assets.

Coinbase chief legal officer Paul Grewal announced the settlement in a Wall Street Journal op-ed on July 22, calling the SEC's record loss unacceptable. "The agency tasked with policing corporate record-keeping somehow lost reams of its own text messages between Mr. Gensler and other officials during the most intense period of the anti-crypto campaign," Grewal wrote. He confirmed the SEC will pay a $150,000 "award" and has corrected its record retention practices.

The case stems from an internal 2025 report that found the SEC had deleted nearly a year of Gensler's texts due to "avoidable" errors. Coinbase originally filed the FOIA request after the SEC dismissed its enforcement action against the exchange earlier in 2025, as the regulator pivoted toward policy development under new leadership.

The resolution marks another legal win for Coinbase under the current SEC chair, Paul Atkins, who has pursued a more crypto-friendly stance and dropped several high-profile cases against digital asset companies in 2025. In a separate matter in February, Coinbase secured a settlement with the Federal Deposit Insurance Corporation, which agreed to pay $188,440 in legal fees and revise transparency practices after a federal court found the FDIC had violated FOIA obligations. Grewal said at the time the litigation produced "dozens of crypto 'pause letters' — indisputable proof of OCP2.0 and the coordinated effort to sideline the industry."

Grewal, who has served as Coinbase's chief legal officer since 2020, is set to transition to an advisory role at the exchange on July 31. Coinbase legal vice presidents Molly Abraham and Ryan VanGrack will become general counsel and vice chair, respectively.