The US Securities and Exchange Commission agreed to pay $150,000 in legal fees to settle a Coinbase lawsuit filed Wednesday, ending a two-year legal dispute over internal agency records. The crypto exchange sought documents to uncover evidence of regulatory enforcement practices during the Biden-era SEC crackdown on crypto. An internal report in 2025 revealed the SEC had deleted nearly a year of former SEC Chair Gary Gensler's text messages due to errors the agency described as avoidable. The settlement represents a legal victory for Coinbase under the Trump administration's more crypto-friendly regulatory approach led by SEC Chair Paul Atkins.
SEC Pays $150,000 to Settle Coinbase Records Lawsuit
The settlement agreement filed Wednesday resolves a two-year lawsuit between the SEC and Coinbase. The crypto exchange initiated legal action seeking internal documents from the regulator to uncover evidence of what it termed "crypto by enforcement." Under the terms, the SEC will pay Coinbase a $150,000 award and has implemented fixes to its record retention policies.
"The agency tasked with policing corporate record-keeping somehow lost reams of its own text messages between Mr. Gensler and other officials during the most intense period of the anti-crypto campaign," said Coinbase chief legal officer Paul Grewal in an op-ed published by the Wall Street Journal on Wednesday.
SEC Deleted Nearly a Year of Gensler Text Messages
An internal report in 2025 revealed the SEC had deleted nearly a year of former SEC Chair Gary Gensler's text messages due to what the agency characterized as "avoidable" errors. The deleted messages covered communications between Gensler and other officials during what Coinbase described as the most intense period of anti-crypto regulatory activity.
The SEC has revised its record retention policies following the settlement.
Coinbase Secures Second Federal Settlement in 2025
The SEC settlement marks another legal victory for Coinbase under the Trump administration. The SEC, under the leadership of Paul Atkins, has dropped several high-profile enforcement actions against crypto companies, including Coinbase, in 2025.
In February, Coinbase reached a settlement with the Federal Deposit Insurance Corporation, with the FDIC agreeing to pay $188,440 in legal fees and revising aspects of its transparency practices after a federal court found it had violated the Freedom of Information Act.
"The years of litigation were worth it. We successfully uncovered dozens of crypto 'pause letters'---indisputable proof of OCP2.0 and the coordinated effort to sideline the industry," Grewal said in an X post in February.
Paul Grewal Transitions to Advisory Role on July 31
Paul Grewal, who has served as Coinbase's chief legal officer since 2020, is set to transition to an advisory role at the exchange starting on July 31. Coinbase legal vice presidents Molly Abraham and Ryan VanGrack will become general counsel and vice chair, respectively.
FAQ
What did the SEC agree to pay Coinbase in the settlement filed Wednesday?
The SEC agreed to pay $150,000 in legal fees to settle a Coinbase lawsuit seeking internal agency records. The settlement ends a two-year legal dispute and includes the SEC's implementation of fixes to its record retention policies.
Why did the SEC delete Gary Gensler's text messages?
An internal report in 2025 revealed the SEC had deleted nearly a year of former SEC Chair Gary Gensler's text messages due to errors the agency described as avoidable. The deleted messages covered communications during the Biden-era SEC crackdown on crypto.
When does Paul Grewal transition from his role as Coinbase chief legal officer?
Paul Grewal transitions to an advisory role at Coinbase starting on July 31. Molly Abraham and Ryan VanGrack will become general counsel and vice chair, respectively.
