US SEC Seeks Coinbase Lawsuit Discovery Extension

The US SEC is seeking a Coinbase lawsuit discovery extension as they have reached an agreement with Coinbase to shift the deadline to February.

The United States Securities and Exchange Commission (SEC) has requested that the Court extend the discovery deadline to February 2025 in its lawsuit against American cryptocurrency exchange Coinbase Global Inc (NASDAQ: COIN). The agency submitted a letter to Judge Katherine Faila requesting an extension from October 18 to February 18 of the following year. The exchange is experiencing an unexpected four-month hiatus.

Coinbase consents to an extension of the discovery deadline

The government agency has submitted a proposed Revised Case Management Plan in addition to the SEC’s request. The requested extension has been agreed to by Coinbase Inc. and Coinbase Global Inc., the defendants in the lawsuit, according to the agency. The agency also emphasized that the SEC vs. Coinbase case has extensive discovery requirements, including producing thousands of documents.

“The SEC is currently reviewing 133,582 unique documents by that agreement.” The agency disclosed that the SEC will have the requisite time to comply with the Court’s Order as a result of the requested extension.

This is the first instance in which any of the parties has requested an extension of the deadline to conclude fact discovery since the inception of the SEC vs. Coinbase case. Nevertheless, the Commission’s decision to take this action is not altogether unexpected, given that it was recently compelled to publicly acknowledge its error in using the term “crypto asset securities” in related cases.

In the interim, Paul Grewal, the Chief Legal Officer of Coinbase, emphasized the advancements made in the FOIA lawsuit against the FDIC to obtain the “pause letters” sent to financial institutions to indicate that they had debanked crypto firms. He verified that the Court requested that the agency surrender a “Vaughn Index,” akin to a FOIA privilege log.

James Murphy, also known as “MetaLawMan,” a pro-crypto lawyer, also provided his perspective. He concurred with Grewal’s assertion that regulators must be subjected to undue pressure to disclose the truth regarding Operation Choke Point 2.0. The government made a concerted effort to prevent traditional financial institutions from servicing crypto firms.

Gary Gensler, the Securities and Exchange Commission chairman, may be departing

Gary Gensler, the Chair of the Securities and Exchange Commission (SEC), is currently under investigation for allegedly recruiting individuals within the agency based on their political affiliations. Markus Thielen, the founder of 10X Research, predicted two months ago that Gensler’s future could be contingent upon the results of the 2024 presidential election.

Republican Presidential candidate Donald Trump has pledged to remove Gensler on his first day in office if he wins the election, despite Thielen’s observation that SEC chairs typically depart when a new president assumes office. Thielen even believes the SEC Chair may resign in January or February 2025. Gensler may not witness the conclusion of the Coinbase case if his timeline is accurate.

The crypto community is abuzz with speculation that Robinhood’s Chief Legal Officer (CLO) Dan Gallagher may succeed Gensler in the event of a Trump victory. In contrast to the current SEC Chair, Gallagher maintains an amicable attitude toward digital assets. Other names mentioned in these discussions include Heath Tarbert and J. Christopher Giancarlo, who were previously the CFTC heads.