Paul Grewal criticized the New York Times for what he described as misleading narrative regarding the SEC's rollback of stringent laws on digital currencies.
The chief legal officer at Coinbase clarified that the newspaper's own reports undermine its headline and the overall narrative of the article.
Senior legal advisor at Coinbase Paul Grewal responds to the New York Times narrative on the SEC's enforcement of digital currency regulations.
Grewal pointed out in a post on X (Twitter) a significant disclosure included in the electronic release of the Times' December 14 investigation regarding the SEC's changing stance on digital assets following Trump's return to the White House in January 2025.
The article clarified that journalists found "no evidence that the president or the White House exerted pressure on the SEC to ease restrictions on specific digital currency companies" and "did not find evidence that these companies attempted to influence the cases against them through donations or business ties with the Trump family."
Grewal wrote that he openly appreciates the journalist in the comments on the electronic version of the story, stating that it "shows that the headline and overall narrative have become more distorted."
A Times investigation documented a sharp decline in enforcement actions against digital currencies by the SEC during Trump's second term.
The report showed that the agency eased more than 60% of the digital currency cases it inherited, as well as halted or dropped lawsuits against several prominent companies, including Gemini run by the Winklevoss twins, and Binance, against which the case was dropped entirely.
The newspaper portrayed this reversal as unusual, noting that it is rare for the SEC to backtrack so broadly on the enforcement of laws against a single industry sector.
The article noted that while some companies with directors or partners who donated to Trump's political campaign benefited, it simultaneously emphasized that there is no evidence of presidential interference or illegal influence.
The SEC also rejected claims of favoritism, stating that legal and policy concerns led to a change in enforcement, including doubts about the agency's authority over a significant portion of the digital currency market.
Critics say the rollback of SEC enforcement was anticipated and not politically driven.
Grewal's criticism came in the context of broader responses from digital currency policy analysts who say the Times failed to provide necessary historical context.
Alex Thorne, head of research at Galaxy, argued that the story relies on a false assumption that the aggressive enforcement campaign in the previous administration represents a normal regulatory situation.
According to Thorne, the SEC under Biden has provided new and highly controversial interpretations of securities laws aimed at broadly enforcing laws against digital currency companies, a strategy that faced:
Years of bipartisan criticisms,
Repeated legal challenges,
Public objections from Republican commissioners Hester Peirce and Mark Uyeda.
When these commissioners transitioned from a dissenting minority to a controlling majority after Gary Gensler's resignation in January, Thorne argues that the resulting policy shift was entirely expected.
Thorne stated in a separate post that "it is not ‘unusual’ at all for the SEC to abandon these cases; if the fundamental assumptions are overturned, it is natural for the cases based on them to collapse."
The Times acknowledged that current Republican commissioners at the SEC opposed many lawsuits related to digital currencies before Trump's return to office.
However, critics believe this context has been overshadowed by a narrative suggesting political impropriety without providing evidence.
These disputes raise an increasing gap between traditional media coverage and the digital currency industry's interpretation of regulatory changes in Washington.
As the SEC moves away from regulation by enforcement towards clearer rule-making, the discussion emphasizes a central question of digital currency policy in the United States: whether a precise distinction can be made between legal and intellectual shifts within the agency and political influence in the public dialogue.
