Coinbase Chief Legal Officer Paul Grewal again making oblique legal threats to chill criticism of Coinbase, suggesting to The Hill that it might be “defamatory” for me or Public Citizen to draw a line from their political spending to the current crypto regulatory environment.

Now, critics are putting the industry’s ramped-up campaign involvement last cycle under a microscope. Molly White, a cryptocurrency researcher and prominent crypto skeptic, argued the SEC’s changes in direction were the “goal of a lot of the election spending over the last couple of years.” “I think that the political contributions were quite directly related to both the changing regulatory environment in terms of, you know, broad policy direction, but also in terms of dropping the enforcement action,” White told The Hill. Public Citizen, a nonprofit consumer advocacy organization, slammed Coinbase and the SEC last week, arguing the industry’s campaign spending “paid off.” “The SEC decision is also an important marker in the Trump administration’s rush to abandon prosecution and enforcement actions against corporate criminals and wrongdoers,” Public Citizen co-President Robert Weissman wrote. “This is not just an abandonment of those already wronged by corporate wrongdoers, it is an invitation to a corporate crime spree and epidemic of corporate wrongdoing.”
Coinbase, along with other figures in the crypto world, fiercely rejected the criticism, pointing out opposition to Gensler’s probes was brewing for years. This included long before Trump publicly reversed his stance on crypto to back the industry in late 2023. “I find those comments misinformed at best, if I’m being generous, and defamatory at worst,” Paul Grewal, chief legal officer at Coinbase, told The Hill of the backlash. Some criticism, Grewal argued, fails to consider Trump was once a critic of crypto and at one point called it a “scam.” Grewal pointed out how Congress moved major legislation in 2023 on market structure, an issue that was met with bipartisan support. The Financial Innovation and Technology for the 21st Century Act in 2023 received support from 71 Democrats in the House. “The fact of the matter is that President Trump did evolve and transform in his view on crypto, really starting in December 2023,” Grewal said. “In January 2024, we first started to engage with him and his team, but it was against a much more nuanced, complicated and complete history that I think a lot of the critics just don’t want to engage in.”

Previously:

Tweet by paulgrewal.eth on October 30, 2024 @iampaulgrewal Once again, with feeling. Repeating misrepresentations of facts after previously being put on notice is …. unwise. Quoted tweet by Molly White @molly0xFFF As an active federal contractor, Coinbase is prohibited from making political contributions, including to super PACs. This makes $50 million that they have contributed in violation of pay-to-play laws for contractors.

“Some criticism, Grewal argued, fails to consider Trump was once a critic of crypto and at one point called it a ‘scam.’ ... ‘[It’s a] more nuanced, complicated and complete history that I think a lot of the critics just don’t want to engage in.’”

Huh.

Screenshot of Molly White’s Citation Needed newsletter: “Recently, there has been a push by the cryptocurrency industry to portray crypto as a major issue that will influence votes in the upcoming election season. This just so happens to coincide with Donald Trump's recent statements suggesting he's warmed to the industry. Although Trump personally has actually been far more vocally anti-crypto than Joe Biden — in 2021 saying bitcoin “just seems like a scam”1 and reportedly ordering Treasury Secretary Steve Mnuchin to “go after bitcoin” in 20182 — that hasn’t stopped many in the cryptocurrency world from embracing him as the supposedly pro-crypto candidate anyway. Screenshot of Trump tweets: I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity.... ....Similarly, Facebook Libra’s “virtual currency” will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National... ...and International. We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar! It's not entirely clear why Trump has done a U-turn. Perhaps it's simply because supporting crypto has become the Republican thing to do. Perhaps it was because he himself discovered the grift potential this industry unlocks when released his own set of NFTs in 2022 [W3IGG]."
Screenshot of a Public Citizen article titled “Guaranteed Crypto Loss”: “Bitcoin, a cryptocurrency, is “based on thin air.” It is a “scam.” It can facilitate unlawful behavior, including drug trade and other illegal activity.” These are Public Citizen positions. But they are also direct comments from then President Donald J. Trump. Public Citizen continues to believe cryptocurrency is a Ponzi scheme and enables illicit activity. It also wastes enormous energy, contributing to climate change. We support the efforts of the Securities and Exchange Commission (SEC) to enforce securities law with respect to these public offerings, and of criminal law enforcers to arrest crypto actors who engage in fraud and other market manipulations. The FBI reported crypto-related fraud exceeded $5 billion in 2023. Trump, however, has pivoted into full-throated and potentially self-enriching endorsement of the sector. He now serves as the “chief crypto advocate” for World Liberty Financial, a nascent cryptocurrency firm. If elected president, Trump would have a glaring conflict of interest as Washington attempts to address policy for this fraud-ridden sector.”
« Back to the activity feed
« Back to the microblog feed
Have you responded to this post on your own site? Send a webmention! Note: Webmentions are moderated for anti-spam purposes, so they will not appear immediately.