Coinbase takes legal action, accusing SEC of erasing a ‘year’s worth’ of Gensler texts

Coinbase cites a report from the Inspector General as proof that the U.S. Securities and Exchange Commission erased a year’s worth of text messages from former Chairman Gary Gensler. Even though, the firm claims the texts were supposed to be preserved.

In a recent post, the firm’s Chief Legal Officer, Paul Grewal, accused the federal agency under the previous chairman of violating public trust by deleting the documents. According to Grewal, the SEC destroyed “documents they were required to preserve and produce.”

These documents include text messages that were sent and received by then-SEC Chairman Gary Gensler from October 2022 to September 2023. According to the Inspector General’s office, these text messages were “destroyed” when the agency’s IT staff “performed a factory reset of the smartphone.”

“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,” wrote Grewal in his latest post.

Gensler isn’t the only one. In fact, Coinbase’s court order alleged that the same can has happened with more than 20 other high-ranking SEC officials’ texts may have also been erased upon the factory-reset carried out by the IT team.

“Although the SEC has known of these glaring and urgent problems for two years, none of this was disclosed to this Court or History Associates,” wrote Coinbase in the court order to the District of California.

As a result, Coinbase is asking the Inspector General to do an “expedited discovery” to recover all the responsive texts. They are also demanding that the SEC face sanctions for deleting the texts.

“It’s not surprising that the same agency that fined firms billions for record-keeping failures committed the exact same violations,” said Grewal.

Coinbase’s FOIA request to the SEC

Coinbase’s court order about the missing texts is part of the firm’s earlier request through a Freedom of Information Act lawsuit. Back in April 2025, Coinbase was able to obtain internal documents from the U.S. SEC.

Most of these documents are related to the federal agency’s probe into Ethereum (ETH) 2.0; such as May 2022 internal analysis of ETH 2.0 under the Howey test, a February 2023 email questioning Ethereum’s security, and an April 2023 memorandum prepared for commissioners before authorizing the ETH 2.0 investigation.

At the time, Grewal criticized the SEC’s inconsistent treatment of crypto assets, questioning why Ethereum passed the agency’s internal “ecosystem” test while others did not.