Coinbase has secured a $150,000 settlement from the U.S. Securities and Exchange Commission, concluding a Freedom of Information Act lawsuit that exposed the loss of nearly 11 months of former Chair Gary Gensler’s text messages. The exchange’s Chief Legal Officer Paul Grewal disclosed the agreement in a July 22 Wall Street Journal op-ed, revealing that the SEC will also revise its record-retention policies.
The missing messages covered October 18, 2022, through September 6, 2023 – a period when the SEC pursued several enforcement actions against digital asset firms. An SEC Office of Inspector General review blamed avoidable IT failures: SEC technology staff performed a factory reset on Gensler’s iPhone after he lost access to agency apps, permanently erasing data before a usable backup existed. Despite a later backup, the texts were unrecoverable, and the report concluded that timely backups and improved recordkeeping could have prevented the loss.
Grewal accused the former SEC leadership of violating public obligations by destroying material Coinbase had requested, writing in September 2025 that “The Gensler SEC did this even though we asked for information about ‘all communications’ within the SEC related to crypto regulatory and enforcement decision-making years ago.” The settlement brings an end to the FOIA dispute, which paralleled broader tensions between the crypto industry and regulators. Coinbase also fought the SEC’s now-dismissed enforcement lawsuit and exposed FDIC “debanking” efforts through a separate FOIA case.
While the financial award is modest, the ruling forces the SEC to update how it preserves official communications, adding to a string of regulatory setbacks for the agency’s crypto oversight approach under the Biden administration.
