Coinbase has decided to fight back against what it sees as unjust treatment by financial regulators. The crypto giant has filed two lawsuits under the Freedom of Information Act (FOIA) against the U.S. Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC).

The basis of these lawsuits? Coinbase claims that these agencies have been stonewalling requests for information that should be available to the public.

Paul Grewal, Coinbase’s Chief Legal Officer, shared a statement on the decision. He accused financial regulators of using their power to harm the digital asset industry. According to him, the SEC has been claiming broad authority over crypto but has failed to provide any clear or consistent rules.

Meanwhile, the FDIC has been pushing banks to distance themselves from the crypto sector. This lack of transparency and clear regulation has led Coinbase to demand better from these agencies.

The SEC’s conflicting feelings on Ethereum

Coinbase’s filings reveal some troubling actions by the SEC. In 2018, the SEC publicly declared that Ethereum (ETH) is not a security. This announcement led Coinbase and other crypto firms to invest heavily in Ethereum.

However, in recent years, the SEC’s position seems to have shifted. The current SEC Chair has been evasive when asked directly whether ETH is a security. This has caused major uncertainty in the market.

In early 2023, during a congressional hearing, the SEC Chair dodged questions about ETH’s status. Around the same time, the SEC quietly initiated an investigation into “Ethereum 2.0,” suggesting a new stance that ETH might be a security after all.

This led to a flurry of subpoenas targeting entities associated with Ethereum, causing further confusion and legal battles. Some firms, like Consensys, even sued the SEC seeking clarity on ETH’s status.

Recently, the SEC seemed to reverse course again by approving spot ETH ETFs, which implies that ETH is not a security. Coinbase said this flip-flopping has left the industry in disarray, unsure of what to expect next from the regulators.

FDIC’s pressure on banks

The FDIC hasn’t been any better, according to Coinbase. The FDIC has been sending letters to financial institutions, urging them to halt all crypto-related activities indefinitely. This action was criticized even by the FDIC’s own Office of Inspector General.

The Inspector General warned that such measures could stifle innovation and growth in the crypto space. Despite this, the FDIC has continued to block Coinbase’s requests for information regarding these letters.

The lawsuits filed by Coinbase are a direct response to this lack of transparency. Grewal emphasized that the company is simply asking for documents about closed investigations and other communications that the public has a right to see. The aim is to understand how these agencies are interpreting and enforcing their authority over digital assets.