So here’s the story, the FDIC (Federal Deposit Insurance Corporation) is being grilled for allegedly playing “guessing words” about important documents requested by Coinbase through their lawsuit. This drama started because Coinbase wanted to know about the letters from the FDIC that told banks to stop dealing with crypto businesses. Well, it turns out that not all of the letters were given by the FDIC.
In a report dated January 17, History Associates, which works for Coinbase, said that the FDIC seemed to have intentionally “forgotten” some of the important letters. There are allegations that they even hid important documents, even the number could be more than 150 documents! Seriously, the FDIC is suspected of withholding information like they are playing “hide and seek.”
Adding to the heat, there are FDIC letters to banks asking them to “take a break” from crypto until the regulatory review is complete. These letters are allegedly part of an operation called “Operation Chokepoint 2.0” which is said to be aimed at blocking crypto companies from banking services.
Paul Grewal, Coinbase’s Chief Legal Officer, said in a January 16 post that they had asked the FDIC for all relevant documents, but the FDIC limited their search to only documents from March 2022 to May 2023. Grewal said, “We asked them to stop playing with words and get their act together, and their answer? It’s going to take a year!” What’s taking so long?
However, the FDIC argued in their report that they had provided all relevant documents and reviewed the letters as requested by the FOIA. They said there was no reason to believe there were any other letters outside of that period. However, they promised to process additional requests more quickly.
Not stopping there, Wyoming Senator Cynthia Lummis immediately sent a letter to the FDIC. In it, she warned that if the allegations about the document destruction and obstruction of the investigation were true, the case could be thrown to the Department of Justice. Oops!
The beginning of this commotion was when Coinbase CEO Brian Armstrong asked the FDIC to provide letters from 2022. But when he got the letter, the contents had been heavily "censored", meaning there was a lot that was covered up. Because of that, Judge Ana Reyes ordered the FDIC to provide more transparent documents.
Long story short, Coinbase hired History Associates to help with the FDIC FOIA. But because it was rejected, the case was taken to court. Isn't the drama exciting? Do you think the FDIC will give in or get even more frustrated?