Coinbase CEO Brian Armstrong has completely closed its doors to crypto-hostile SEC staff. Armstrong warned that the crypto exchange will cut ties with any law firm that hires such staff. Former SEC Enforcement Director Gurbir S. Grewal recently joined Milbank. Armstrong said Coinbase would not work with the firm while he was there.
Brian Armstrong: Coinbase will not work with those who hire them!
Coinbase CEO Brian Armstrong has warned law firms not to hire former SEC staff that he sees as hostile to the crypto industry under the leadership of outgoing Chairman Gary Gensler and the Biden administration. In his statement, Armstrong underlined the following points:
We have notified all law firms we work with that if they hire anyone who did any of these bad things under the previous administration, we will no longer be their client.
SEC Enforcement Division Director Gurbir S. Grewal is in the crosshairs!
The Coinbase CEO highlighted Milbank’s October appointment of former SEC Division of Enforcement Director Gurbir S. Grewal as a partner, claiming that partners at these law firms appear to be “unaware of the crypto industry’s position on this issue.” “We are not working with them now and never will be while he is there,” Armstrong said.
Grewal served as the SEC’s top cop. As you follow from Kriptokoin.com, he has brought enforcement cases against leading US-based crypto companies such as Coinbase, Kraken and Ripple, as well as international organizations such as Binance. During the current administration, the SEC has issued a series of Wells Notices to some crypto firms. It informed that enforcement action would be pending. These include Uniswap Labs, Robinhood Crypto and OpenSea.
Coinbase CEO explained the reason for the warning!
Gary Gensler recently announced plans to leave the agency on January 20, 2025. Gensler has been a staunch advocate that most cryptocurrencies are securities. In this regard, he has urged crypto firms to register with the SEC. However, some in the crypto industry have countered by saying that it is impossible to register with the agency, partly because rules have been put in place for more traditional assets that are different from the digital asset industry. Regarding this issue, Coinbase CEO emphasized the following:
Trying to illegally kill an industry while refusing to publish clear rules is a breach of ethics in my book. If you were senior there, you couldn’t just say you were following orders. There were options to leave the SEC and a lot of good people did. This was not a normal SEC tenure (…) Let your law firms know that hiring these people means losing you as a client.
Industry hopes for a more crypto-friendly SEC under Trump
President-elect Donald Trump made several pro-crypto promises during the US election campaign. These include firing Gensler and diluting the role of the SEC under a new framework. Therefore, there is hope in the industry that Donald Trump’s administration will work more collaboratively with it.
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