Coinbase Demands SEC Accountability After Lost Gary Gensler’s Text Messages Episode

Coinbase turns up the heat on regulators as missing Gensler texts spark transparency crisis.

Regulatory Runaround

The exchange isn't backing down—demanding full SEC accountability after officials 'lost' crucial text messages during a critical investigation period. No backups, no paper trail, just another day at the finance regulator's office.

Pattern of Problems

This isn't the first time documentation has mysteriously vanished when oversight agencies come under scrutiny. Convenient how government transparency works until it doesn't—almost like those 'lost' emails from 2008 all over again.

Industry Implications

The crypto sector watches closely as established players challenge regulatory overreach. When the watchdogs can't keep their own records straight, maybe they shouldn't be writing the rules for everyone else.

Court orders allegedly violated

The court filing alleged that the SEC violated multiple judicial orders requiring production of communications between Gensler and other officials regarding Ethereum’s regulatory status.

Despite court directives encompassing “all documents and communications,” the agency’s productions included no text messages and did not indicate that texts were searched.

The SEC conducted belated text message searches only in April and June 2025, months after claiming compliance with court orders.

Additionally, the filing argued that the agency reported no responsive texts were found. However, it acknowledged that searches were incomplete due to technical limitations affecting dozens of senior officials’ devices.

‘Mission-related communications’

The Inspector General found that 38% of recovered Gensler texts involved “mission-related communications,” including discussions related to crypto enforcement, contradicting claims that he used texts only for administrative purposes.

One May 2023 conversation involved Gensler, his staff, and the Enforcement Division Director discussing the timing of actions against crypto trading platforms.

Grewal said the information creates a double standard problem for the SEC, which imposed over $1 billion in fines on financial firms for recordkeeping violations during Gensler’s tenure.

He added that the agency emphasized that “everybody should play by the same rules,” while pursuing enforcement actions for identical text message preservation failures.

History Associates, representing Coinbase, argues that 40 additional senior SEC officials face an ongoing risk of losing text messages due to backup system failures. The filing requests emergency intervention to prevent further destruction of documents.