Coinbase Files two FOIAs, Challenges U.S. Regulators Over Secret Crypto Banking Restrictions

Coinbase has escalated its efforts to seek clarity on U.S. cryptocurrency regulations by filing two Freedom of Information Act (FOIA) requests against American regulators.

The requests aim to uncover details related to a reported regulatory cap on bank deposits from crypto companies and the handling of earlier inquiries on crypto-related matters.

Paul Grewal, Coinbase’s chief legal officer, announced via X (formerly Twitter) that the company is specifically asking for information on a 15% limit allegedly imposed by the Federal Deposit Insurance Corporation (FDIC).

This cap reportedly restricts the amount of deposits that banks can accept from cryptocurrency businesses, a rule that Coinbase argues was implemented without public consultation—a process typically required by U.S. law.

Grewal explained that Coinbase is seeking documents that clarify how this deposit cap impacts the broader crypto industry. "We want to understand the basis of this decision and how it influences our sector," he said.

In addition to the inquiry about the FDIC cap, the second FOIA request asks for records on how the FDIC and other regulatory bodies have responded to previous FOIA filings concerning cryptocurrencies. This follows Coinbase's 2023 lawsuits against both the FDIC and the U.S. Securities and Exchange Commission (SEC) for their alleged failure to provide adequate responses to earlier requests.

One of Coinbase's ongoing concerns involves the SEC’s classification of Ethereum (ETH) and its staking pools. The company has long called for the release of documents that would clarify the agency’s stance on these issues, which remain murky.

Coinbase has also questioned the FDIC’s supposed use of “pause letters,” which reportedly urged banks to slow down activities involving crypto-related businesses. Grewal emphasized that the current FOIA filings are separate from those initiated over a year ago, which have since led to federal lawsuits.

Beyond legal actions, Coinbase has increasingly engaged in political advocacy, promoting pro-crypto regulation through its "Stand with Crypto" campaign and launching a political action committee (PAC) in March 2024. This move signals the company’s commitment to shaping the regulatory landscape ahead of the upcoming U.S. presidential election.

In recent reports, Republican candidate Donald Trump has expressed strong support for positioning the U.S. as a leader in cryptocurrency. Meanwhile, Democratic candidate Kamala Harris has been less vocal on the issue.

As Coinbase continues to push for transparency and fair regulation, Grewal made the company’s stance clear: "So long as the government will not relent, neither will Coinbase."

This latest chapter highlights Coinbase's ongoing efforts to gain regulatory clarity and its determination to ensure the cryptocurrency sector has a more predictable and fair framework moving forward.