Coinbase Fights Back: CLO Challenges US GAO’s Stance On Crypto Sanctions

Paul Grewal, the Chief Legal Officer (CLO) of the San Fransisco-based cryptocurrency exchange Coinbase, has fired back at the United States Government Accountability Office’s (GAO) claims regarding crypto sanctions.

Coinbase CLO Refutes US GAO’s Claims

The Coinbase CLO took to the social media platform X (formerly Twitter) hours ago to express his displeasure with the US GAO’s report on crypto sanctions. Grewal slammed the government agency for a lack of comprehensive analysis of the report and its conclusions.

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GAO’s report brought up concerns regarding the utilization of cryptocurrencies to get around US economic sanctions. It also included examples of how foreign governments facing US sanctions have gotten around the intended effects of economic penalties through the use of crypto assets such as Bitcoin (BTC).

In the X post, Grewal questioned why there were not any general analyses or comparative investigations laid out in the report. He further claimed that the GAO was going after a sector of the economy that invests millions of dollars and abides by the law.

The post read:

Zero comparative analysis performed. Heck, zero analysis whatsoever was performed.  Instead, they harangue an industry that spends millions and millions to follow the law. Ask yourself— why?.

In the post, the CLO of Coinbase also advised the crypto community to carefully examine the report’s contents. He has noted hidden remarks that suggest crypto is not a reliable way to avoid sanctions despite what was stated in the report.

“And yet even in this missive, buried deep in the links behind the clickbait, are admissions that digital assets are a rather poor way to circumvent sanctions,” he said. This demonstrates that the GAO is uncertain of its position, showing that the crypto sector can not bear all the blame.

Furthermore, Grewal has also voiced concerns about the GAO’s research being funded by taxpayers’s money. According to him, taxpayers seeing their money being spent on such “shoddy work” would be “embarrassing.”

“This would be merely embarrassing for taxpayers but for the fact that taxpayers have funded this shoddy work,” he stated. In addition, the Coinbase chief asserted that this is “the smell of the people’s money burning.”

Paul Grewal Fights Back Against The SEC’s Overreach

The United States Securities and Exchange Commission (SEC) previously claimed that it has authority over all investment contracts. However, the Coinbase chief has refuted such claims, noting that the SEC lacked a precise definition of an investment contract despite its claims.

He stated that the SEC’s stance is ambiguous as the legal battle between Coinbase and the agency intensifies. According to him, Congress, not the SEC, should be responsible for establishing such boundaries and casting doubt on the regulator’s regulatory power.

Grewal has highlighted a clear stance for Coinbase as he said that the exchange “does not offer securities.” He has also demonstrated confidence in their legal dispute with the SEC and expects a decision that will provide “much-needed clarity to the industry.”

So far, the Coinbase CLO has expressed gratitude to the Court for its precise consideration while allowing the firm to present its case.