Coinbase, one of the leading cryptocurrency exchanges in the U.S., has a motion pending in front of the D.C. District Court to reinstate its Freedom of Information Act lawsuit against government agency, the Federal Deposit Insurance Corporation (FDIC)
The exchange says the FDIC is still withholding some important documents and not fully cooperating with requests for information.
The lawsuit seeks to force the FDIC to hand over records of its conversations with banks related to cryptocurrency actions, including the ‘pause letters’ issued to banks telling them to stop providing crypto services.”
Coinbase seeks court’s intervention as FDIC cooperation falters in Operation Choke Point 2.0 dispute
Coinbase has been involved in a months-long battle with the FDIC. The firm has been pursuing the FDIC over Operation Choke Point 2.0 for months now and has achieved impressive results. Despite this, Coinbase is asking the DC District Court to resume its litigation against the regulator.
The legal action was initially paused in February 2025 after President Trump appointed Travis Hill as acting FDIC chairman. Hill vowed to enhance the agency’s transparency beyond FOIA requirements, raising hopes that the matter could be resolved outside of court.
Still, Coinbase’s Chief Legal Officer, Paul Grewal, says there is ongoing dissatisfaction with the FDIC’s transparency. He acknowledges that cooperation has improved under the new leadership but feels it is still not enough.
“We’re asking the Court to resume our lawsuit because the FDIC has unfortunately stopped sharing information. While we would have loved to resolve this outside of the legal system – and we do appreciate the increased cooperation we’ve seen from the new FDIC leadership – we still have a ways to go,” claimed Paul Grewal, Coinbase’s Chief Legal Officer.
As a key US financial regulator overseeing banks, the FDIC played a central role in Operation Choke Point 2.0, restricting banks’ interactions with cryptocurrency businesses. However, it recently began a pro-crypto turn, releasing relevant documents and revoking several of its anti-crypto regulations.
Grewal says that he “appreciated the increased cooperation” from the FDIC. However, he noted that the cooperation had stopped weeks ago.
According to Coinbase’s filing, the FDIC hasn’t sent any new information since late February and claimed in early March that the exchange’s subsequent requests were “unreasonable and beyond the scope of discovery.”
The FDIC is expected to respond to Coinbase’s motion within two weeks.
Coinbase pushes for court action as FDIC’s overreach could alter the future of crypto innovation
Operation Choke Point 2.0 is the term used for a series of actions allegedly taken by certain federal regulators and agencies, including the FDIC, to limit banking access to certain high-risk or controversial industries, including cryptocurrency businesses.
Critics say this is a subtle ploy to kill the crypto space by denying exchanges, brokerages, and other players in the ecosystem access to traditional banking services.
Coinbase contends that actions taken, especially through informal guidance and informal pressure on banks, have launched a hostile environment for cryptocurrency businesses under the FDIC.
These operations resulted in an illegal restriction on access to banking services, which placed cryptographic firms in a relatively disadvantaged position in the financial arena.
As part of its effort to revive the case, Coinbase is seeking court intervention to compel the FDIC to answer and prevent such overreach in the future. Coinbase argues that such overreach chills innovation in the digital assets market.
The FDIC’s actions, they argue, violate both due process and the First Amendment, as cryptocurrency companies believe they should not be penalized based on what business they choose to operate.
If Coinbase is successful in reviving its lawsuit, the implications could be sweeping for both the cryptocurrency industry and the regulatory agencies.
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