WASHINGTON, D.C.— Dennis Kelleher, President, CEO, and Co-founder, issued the following statement in response to reports that the SEC is dropping its lawsuit against Coinbase:

“The SEC, the cop on the financial beat, is unilaterally disarming. It has moved from investor protector to a financial industry cheerleader. That is going to have historic repercussions and, along with the Trump administration’s other widespread deregulation, will almost certainly lead to an economic catastrophe.

“The SEC’s reported surrender in its lawsuit against Coinbase is a historic mistake that endangers investors, markets, and financial stability. The SEC used to enforce the law without fear or favor but is now favoring the crypto industry and fearing billionaire crypto kingpins who are publicly belittling the agency. These actions grievously undermine the SEC’s important role in the U.S. capital markets and will embolden lawbreakers while eroding the trust and confidence of investors. As happened with derivatives in driving the 2008 financial crash, the rewards being showered on the crypto industry by the Trump administration apparently in return for campaign contributions are going to cause a financial crash and hurt millions of innocent Main Street Americans.

“It is tragic to watch in real time the SEC, which was created in the aftermath of the Great Crash of 1929, ignore the key lessons it should have learned from its many failures that contributed to causing the 2008 financial crash. Today’s action, along with many others by the SEC in just the last 30 days,[1] proves that the SEC has lost its way and will be an enabler if not a key driver of the next catastrophic crash.”

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[1] Those other actions include issuing new restrictive guidance for shareholder proposals, preventing large shareholders from engaging with companies on environmental or social issues, reducing information to catch lawbreakers via the Consolidated Audit Trail (CAT), permitting around-the-clock trading, dismantling the crypto enforcement unit, repealing accounting guidance designed to protect the financial system from crypto’s risks, pausing and likely abandoning defense of the climate risk disclosure rule, and taking actions to drop other key lawsuits against lawbreakers like Binance.