Coinbase Sues SEC and FDIC Over FOIA Requests

The Breakdown First Five - Friday, June 28, 2024

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. SCOTUS Strips SEC Power

The Supreme Court has put the final nail in the coffin of SEC in-house tribunals. SCOTUS decided that SEC defendants in fact have a right to a jury trial to be heard in the regular court system. The internal SEC tribunal system was established under Dodd Frank in 2010. This is the latest in a series of measures to cut down the power of the administrative state.

4. VanEck Solana ETF

VanEck has filed for a spot Solana ETF. Other spot crypto ETFs have leaned on the existence of regulated futures markets, which Solana lacks. VanEck’s Matthew Sigel isn’t worried, he thinks that a surveillance sharing agreement with Coinbase should be enough to satisfy the SEC. While many think this has no chance of being approved, the final deadline is well into next year so could be decided under a new SEC chair. 

3. Cleanspark Acquires GRIID

Bitcoin mining M&A heats up with Cleanspark acquiring GRIID for $155M in an all-stock transaction. The deal is expected to add more than 400 megawatts of capacity to Cleanspark over the next few years. The largest existing GRIID facility is 68MW of mining capacity in East Tennessee, which is slated to double in size. 

2. Crypto Skips Debate

Crypto didn’t come up during the presidential debate despite Trump’s outspoken position. Biden put up a lackluster performance which triggered a collapse in Polymarket odds. Trump surged to 67% to win the election. Biden’s performance was so poor that California Governor Gavin Newsom became the talk of the debate, with pundits speculating he will be swapped in. To the extent Newsom has a crypto policy, it’s to ensure compliance costs don’t hamstring startups. 

1. Coinbase FOIA Lawsuits

Coinbase has filed a pair of lawsuits against the SEC and the FDIC demanding a review of Freedom of Information Act requests. The SEC had said they need to keep token investigations dating back to 2018 secret to protect future enforcement. They blocked release of the Ethereum 2.0 investigation files alongside two older cases. The FDIC didn’t want to share the pause letters they sent to banks in 2023 as part of Operation Chokepoint 2.0.