Coinbase CEO Cuts Ties with Law Firms Employing Ex-SEC Officials
Coinbase CEO Brian Armstrong has publicly opposed law firms hiring individuals linked to what he termed the "unethical actions" of the Biden Administration.
Coinbase Cuts Ties with Milbank LLP
Armstrong's statement followed Milbank LLP's hiring of former SEC Enforcement Chief Gurbir Grewal as a partner. Grewal oversaw enforcement actions that resulted in substantial penalties against crypto firms, prompting Armstrong to declare that Coinbase would no longer engage with any law firm that employs individuals involved in regulatory crackdowns on the crypto sector.
Armstrong criticized these actions for hindering innovation through vague and restrictive regulations. He stated, "It’s an ethics violation in my book to try and unlawfully kill an industry while refusing to publish clear rules," emphasizing that senior officials at the SEC had alternatives to remain in their positions.
He confirmed the termination of Coinbase's relationship with Milbank and indicated it would not be reconsidered until Grewal departs from the firm.
Grewal's Record at the SEC
During his tenure at the SEC, Grewal led over 100 enforcement actions against crypto firms, securing civil penalties exceeding $20 billion. While some view these actions as necessary for market integrity, critics, including Armstrong, argue they contribute to a broader "war on crypto" under the current administration.
As of October 2024, enforcement actions against crypto firms have reached a total of $19.45 billion in settlements, representing an almost 80% increase from the previous year. Coinbase itself is facing legal challenges from the SEC, including a lawsuit filed in June 2023 for alleged securities law violations.
Despite these challenges, Armstrong and Coinbase continue to advocate for fair and transparent regulations, opposing perceived regulatory overreach.
Rallying the Crypto Industry
Armstrong urged the broader crypto market to follow Coinbase's lead in severing ties with law firms employing individuals linked to aggressive regulatory actions. He clarified that he does not support permanently canceling individuals but believes those involved in anti-crypto policies should seek employment outside the sector.
He stated, "We shouldn’t be funding the very people who tried to dismantle our industry," advocating for collective accountability while pushing for equitable regulations. Armstrong previously warned lawmakers that opposing crypto could jeopardize their careers following the November 5 elections.