Coinbase, the popular crypto exchange, has recently disclosed a notable surge in law enforcement requests, as reported in its latest transparency report. Comparing to the previous year, Coinbase has experienced a threefold increase in the number of requests received in 2021.
Request Origins and Breakdown
Out of the 13,079 requests for information, nearly half of them originated from the United States. Germany accounted for 15% of the total requests, followed by the United Kingdom and Spain. The overwhelming majority, 96%, were related to criminal investigations, while the remaining requests pertained to civil or administrative matters.
Commitment to Tailored Responses
“Where necessary, we will seek to narrow requests that are overly broad or vague in order to provide a more appropriately tailored response, and in some cases we object to producing any information at all,” said Paul Grewal, Coinbase’s chief legal officer.
Coinbase places great importance on providing an appropriate and tailored response to these requests. They are dedicated to narrowing down broad or vague requests and sometimes even object to fulfilling certain information requests.
Voluntary transparency reports have become customary among major tech companies. Coinbase joins the ranks of Verizon, AT&T, Apple, and Google. While Coinbase experienced a 6% increase in the total number of requests from the previous year, it pales in comparison to the staggering 127,766 requests received by Verizon in the first half of 2021.
In 2022, San Francisco-based crypto exchange Kraken reported 3,705 law enforcement requests, the majority of which were from international sources. Coinbase, on the other hand, saw a remarkable threefold increase in requests originating from Ukraine. Furthermore, government agencies in Australia, Portugal, Romania, and Nigeria more than doubled their requests, as stated in the report.
Coinbase has been actively expanding its global presence and making efforts to comply with regulations in various countries. The exchange recently obtained an Anti-Money Laundering (AML) compliance registration from the Bank of Spain, solidifying its position as a registered crypto exchange in the country. This registration enables Coinbase to offer its full range of products and services to both retail and institutional users in Spain while adhering to the country’s legal framework.
Over the past year, Coinbase has obtained Virtual Asset Service Provider (VASP) registrations in several European countries, including Italy, Ireland, and the Netherlands. Additionally, it has received in-principle approval and successfully launched its services in Singapore, Brazil, and Canada. This global expansion strategy is driven by the growing regulatory challenges faced by the company in the United States. In June, Coinbase was sued by the SEC for allegedly selling unregistered securities and engaging in various unlawful activities. Show Cause orders were also issued by 11 US states, demanding Coinbase to justify why it shouldn’t cease operations in those states.
