Coinbase Says Oregon AG "Resurrecting the Dead” With Latest Enforcement Action

‘States Must Fill Enforcement Vacuum’: Oregon Attorney General Sues Coinbase

The Oregon Department of Justice sued Coinbase on Friday in state court, asserting that the cryptocurrency exchange encouraged and facilitated the sale of unregistered securities and “reaped millions of dollars in fees as Oregonians have faced huge losses, often devastating, from risky investments.”

“States must fill [the] enforcement vacuum being left by federal regulators who are abandoning these cases under [the] Trump administration,” Oregon Attorney General Dan Rayfield said in a statement. “After building trust with Oregon consumers, Coinbase sold high-risk investments without them being properly vetted to protect consumers. Oregonians lost money, and we believe Coinbase should be held accountable and take steps to protect consumers.”

Paul Grewal, the Coinbase chief legal officer, said on social media that the attorney general was “resurrecting the dead” by bringing a copycat case of the brand of regulation-by-enforcement typically brought against crypto companies by former U.S. Securities and Exchange Commission Chair Gary Gensler.

Musk’s DOGE Hunts for SEC Cuts but Savings Will Prove Elusive

The SEC’s enforcement unit is line for more cuts as incoming chairman Paul Atkins, confirmed by the Senate on April 9, is expected to steer the agency away from the aggressive enforcement favored by predecessor Gary Gensler. […]

“Acting too precipitously with the regulators of the financial markets could have an adverse impact on the markets, so my expectation would be that they would take a lighter touch,” said Frank Zarb, a partner at Proskauer Rose LLP and SEC alum who concentrates on federal securities regulatory matters. “I would use the word ‘streamlining’; the words ‘chainsaw’ and ‘dismantling’ are not what I would use in this context.”

Atkins is likely to bring his own ideas to the table for making the agency more efficient, given his own background at the SEC as a former commissioner, Zarb added.

“One of his goals will be to avoid enforcement cases in grey areas, what some have called ‘regulation through enforcement,’” he said. “If you do that, by definition, you may be paring back on the scope of what the enforcement division is doing in some areas.”

That may mean more cuts to enforcement staffing, after the agency already took steps to scale back its local footprint by eliminating regional director roles and canceling office leases in Los Angeles and Philadelphia.

White House Seeks to Bring Financial Regulators Under Its Sway

The White House is stepping up its efforts to bring independent agencies — including the Securities and Exchange Commission and the Commodity Futures Trading Commission — under its control, requiring allies of President Donald Trump to approve all new regulations beginning Monday.

New guidance from the Office of Information and Regulatory Affairs, delivered to agencies Thursday, implements a February executive order that sought to end the independence of entities that regulate a broad range of economic activity, including energy, labor, media and consumer products. […]

The 25-page memo from acting OIRA administrator Jeffrey Clark instructs independent agencies to involve the White House regulatory office at all stages of rulemaking. It requires independent agencies to appoint a regulatory policy officer — generally a political appointee — by Monday.

Over $380M Worth of Crypto Stolen During Bybit’s $1.4B Hack Has Gone Dark

Cryptocurrency exchange Bybit’s CEO Ben Zhou said that 27.95% of the funds lost in the $1.4 billion exploit engineered by the North Korean Lazarus Group have gone dark or become untraceable.

“Total hacked funds of USD 1.4bn around 500k ETH. 68.57% remain traceable, 27.59% have gone dark, 3.84% have been frozen. The untraceable funds primarily flowed into mixers then through bridges to P2P and OTC platforms,” Zhou said in an executive summary published on X on Monday.

Crypto Knocks on the Door of a Banking World That Shut It Out

Crypto is pushing deeper into the banking system.

A regulatory crackdown on crypto in the wake of the meltdown of FTX and two crypto-friendly banks prompted some in traditional finance to break up with the industry two years ago. Now President Trump’s pledge to make America a “bitcoin superpower” has set the stage for crypto to become more intertwined with the banking system.

A host of crypto firms including Circle and BitGo plan to apply for bank charters or licenses, according to people familiar with the matter. Crypto exchange Coinbase Global COIN 1.64%increase; green up pointing triangle and stablecoin company Paxos are considering similar moves, other people said.