John E. Deaton, a legal expert and cryptocurrency advocate, harshly criticized critical the United States government for its recent large-scale Bitcoin transfers to the San Francisco-based crypto exchange Coinbase. Deaton, well known for his outspoken opinions on regulatory issues in the crypto space, has expressed concerns about the implications of these transfers, questioning the transparency and motivations behind the government’s actions.
US government’s Bitcoin transfers under fire
These criticisms are the result of the US government moving a significant portion of Bitcoin to Coinbase, one of the world’s largest cryptocurrency exchanges. According to reports, thousands of Bitcoins are involved in these transactions, which were linked to assets recovered by law enforcement during several cryptocurrency crime operations.
Data from Arkham, a blockchain company revealed that the US government transferred over 3,940 BTC worth $241 million to Coinbase. Originally taken from drug trafficker Banmeet Singh, this Bitcoin was confiscated during the trial in January 2024. This remarkable transaction comes amid a slowdown in the global crypto market, which has attracted mainstream attention.
In response to transactions with whales, John E. Deaton He said it is actions like these by the U.S. government that people are tired of seeing as absurd. He then called out Gary Gensler, Chairman of the U.S. Securities and Exchange Commission (SEC), and U.S. Senator Elizabeth Warren, noting that Gensler is continuing to work under Warren’s administration, while joining the anti-crypto army she pledged to create when she announced her re-election.
Deaton criticized the U.S. government for using Coinbase for its Bitcoin transfers even though the exchange is accused of engaging in illegal trading activities by the US SEC and Gensler.
He stated:
Gensler, as Chairman of the SECGov, declared Coinbase’s activities illegal. Yet the US government is using this illegal activity to sell Bitcoin to the American public. You can’t make this stuff up.
The legal expert’s criticism suggests an inconsistent attitude on the part of the US government, suggesting that despite the incessant legal battles against Coinbaseusing the platform for such transactions amounts to indirectly endorsing them. Furthermore, this action raises serious concerns about the government’s regulatory procedures and implies that it damages the SEC’s reputation.
Coinbase hits back at US SEC
John Deaton’s thoughts coincide with Coinbase’s recent lawsuit against the US SEC and the Federal Deposit Insurance Corporation (FDIC), signifying a dramatic intensification of the fight for regulatory clarity in the cryptocurrency space.
Paul Grewal, Coinbase’s Chief Legal Officer declared that the exchange sued the regulatory watchdog under the Freedom of Information Act (FOIA) for requests made more than a year ago, seeking crucial information to which Coinbase and the general public are entitled .
The platform requires documents from the SECOND regarding Ethereum, and whether the digital asset is considered a security or not. Meanwhile, for the FDIC, Coinbase is seeking letters regarding suspension notices the company claims to have sent to financial institutions regarding crypto-related activities.
Featured image of X, chart from Tradingview.com
