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Coinbase CEO Brian Armstrong has announced that the crypto exchange will sever ties with law firms employing former US Securities and Exchange Commission (SEC) officials involved in what he claims was an effort to “unlawfully kill” the crypto industry.
“We’ve informed all the law firms we work with that if they hire individuals who were part of these unethical actions in the prior administration, we will no longer be their client,” he wrote in a 3 December 2024 post on X.
His comments specifically targeted Milbank, a global law firm that recently hired Gurbir Grewal, the former SEC Division of Enforcement chief, as a partner.
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Grewal Oversaw Increase In Enforcement Actions Against Crypto
During his tenure at the SEC, Grewal oversaw a significant increase in enforcement actions against crypto firms, including high-profile lawsuits against Coinbase and Binance.
“Milbank recently messed up and hired Gurbir. We don’t work with them now (and never will while he works there),” Armstrong said.
Armstrong described the SEC’s approach under Grewal as an “ethics violation,” accusing the agency of attempting to stifle the crypto industry without providing clear regulatory guidance.
“They had the option to leave the SEC, and many good people did. For those who stayed and contributed to this overreach, accountability is necessary,” Armstrong said.
Grewal and the SEC defended their actions as critical to combating fraud and protecting investors, with over 100 enforcement cases initiated during his leadership.
Armstrong, however, criticized these measures as overreach and emphasized the harm caused by the lack of clear rules for the sector.
We’ve let all the law firms we work with know, that if they hire anyone who committed these bad deeds in the (soon to be) prior administration, we will no longer be a client of theirs.
Senior partners at these law firms seem unaware of the crypto industry’s position on this.… https://t.co/k8R6NtfTV1 pic.twitter.com/RT0k408i9f
— Brian Armstrong (@brian_armstrong) December 3, 2024
The Coinbase CEO called on the broader crypto community to take a stand, urging companies to reject legal representation from firms employing individuals who had worked against the industry.
“Let your law firms know that hiring these folks means losing you as a client,” he advised.
Armstrong’s comments coincide with significant leadership changes at the SEC.
Chair Gary Gensler, known for his aggressive enforcement stance on crypto, has announced his resignation, effective 20 January 2025. SEC Commissioner Jaime Lizárraga also plans to step down on 17 January 2025, citing personal reasons.
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Trump Pledges To Overhaul SEC Leadership
President-elect Donald Trump has also pledged to overhaul the SEC’s leadership. He has criticized the agency’s regulatory stance and promised to replace Gensler.
This came as the SEC has taken a tougher stance against crypto firms in 2024. More specifically, the regulator imposed nearly $4.7 billion in enforcement actions against crypto companies, a 3,018% increase from 2023.
The fines included forfeitures, disgorgement, civil penalties, settlements, and prejudgment interest, calculated from the time the SEC initiated each case.
The agency also faced a barrage of criticism during a congressional hearing on Wednesday, 18 September 2024. This came as a predominantly critical witness panel voiced their concerns over the agency’s regulatory approach towards digital assets.
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Disclaimer: Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
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