In a significant development, the U.S. Department of Justice’s asset forfeiture division, the U.S. Marshal Service, has selected Coinbase as its custodial services provider for large-cap digital assets.
Coinbase announced the partnership in a recent press release blog posthighlighting the agency’s selection of Coinbase Prime as the custodial and advanced trading services provider for its “Class 1” digital assets, centrally managed to support federal law enforcement activities.
Coinbase secures partnership with government
The U.S. Marshals Service conducted a thorough due diligence process, considering various solutions, and ultimately selected Coinbase due to its history and ability to safely provide institutional-grade services. cryptographic services on the scales.
Agency he stated that reliable storage and liquidation techniques are required to professionally manage and dispose of significant quantities of popular cryptocurrency assets, known as Class 1 cryptocurrencies, in a manner consistent with principles set forth by the Department of Justice and the United States Marshals Service.
The partnership will streamline the storage, management, and disposal of cryptocurrency assets, sources said, allowing for the diversification of the types of digital assets that can be handled and disposed of under government asset forfeiture programs.
Coinbase highlighted its long-standing history of supporting law enforcement and working with key federal, state and local agencies in the U.S., as well as international agencies all over the world. The stock exchange wrote:
Coinbase currently partners with every major U.S. federal, state, and local agency, as well as international agencies on every continent. Growing the cryptoeconomy means promoting safe and sound and competent markets, and these partnerships are central to our mission.
Is a regulatory inconsistency revealed?
While Coinbase’s selection by the US Marshal Service is indicative of its ability to serve government entities, the exchange is subject to regulatory scrutiny from agencies like the US Securities and Exchange Commission (SEC).
Despite this, the US government recently moved over 3,940 BTC worth $241 million to Coinbase, which were originally confiscated from drug dealer Banmeet Singh during his trial in January 2024.
Pro-cryptocurrency lawyer John E. Deaton criticized the U.S. government’s actions, calling them “nonsense.” Deaton specifically criticized SEC Chairman Gary Gensler and U.S. Senator Elizabeth Warren, noting that Gensler continues to work under the Warren administration, allegedly joining the anti-crypto movement she promised to create after announcing her re-election.
Deaton highlighted the irony of the U.S. government using the Coinbase platform to Bitcoin Transfers while the exchange itself is grappling with accusations of alleged illegal business activities by the SEC and its chairman, Gary Gensler.
Deaton pointed out the contradiction between Gensler, as SEC chairman, who deemed Coinbase’s activities illegal, and the U.S. government, which cited the same “illegal” activities to sell bitcoin to Americans.
Ultimately, this situation raises questions about the coherence and consistency of the government’s approach to cryptocurrenciesespecially regarding Coinbase’s involvement in official transactions despite ongoing regulatory challenges.
This incident highlights the need for clarity and consistency across regulators and government agencies in order to create a more predictable and enabling environment for the cryptocurrency industry.
Featured image from DALL-E, chart from TradingView.com
