FDIC ordered to cease ‘blanket redacting’ in Coinbase FOIA case

The Federal Deposit Insurance Corporation has been ordered to fully comply with the court order and make “more careful corrections” to pause letters requested by crypto exchange Coinbase.

On December 12, Judge Ana C. Reyes flagged excessive corrections made by the Federal Deposit Insurance Commission in response to Coinbase’s Freedom of Information Act complaints.

According to Coinbase CLO Paul Grewal, Judge Reyes noted that the FDIC lacked good faith and did not comply with court orders in the documents it provided. Grewal added that the agency may be withholding relevant information from the industry.

Coinbase, like much of the crypto industry, bemoans rampant bank banking run by U.S. federal agencies. Alleged conspirators in the so-called “Operation Choke Point 2.0,” such as the FDIC, reportedly ordered financial institutions to deny bank accounts to crypto businesses.

A group of crypto executives from firms including Custodia and Andreessen Horowitz have accused regulators of waging a “concerted, coordinated campaign” to shut down the banks of tech innovators and blockchain creators.

Last week, documents turned over by the FDIC showed that the US government had ordered banks to ban cryptocurrencies, proving many industry officials who have been pushing for OCP 2.0 for years were right.

Unclear rules regarding digital assets have further surrounded crypto businesses. Without a standardized framework, industry players have decried the uncontrolled information restrictions and stifling bureaucracy of agencies like the FDIC.

Coinbase and others took legal action to uncover these suspicions. While the industry awaits fairer practices and regulations, agitations have revived with Donald Trump’s election victory.

Following Trump’s victory, changes began in federal institutions. FDIC chairman Martin Gruenberg and Securities and Exchange Commission chairman Gary Gensler announced their resignations.

Pro-crypto investor and former Regulator Paul Atkin has been named to replace Gensler at the SEC, subject to Senate confirmation. Trump also considered tapping a16z head of crypto policy and former federal regulator Brian Quintenz to lead the Commodity Futures Trading Commission.