USMS Selects Coinbase Prime for Crypto Custody as Firm Fights SEC Lawsuit

• The USMS chose Coinbase Prime for custody and advanced trading of large-cap digital assets to facilitate the ease of asset management.
• The $32 million contract won by Coinbase Prime from USMS additionally underlines the critical role it has played in law enforcement handling digital assets.
• Even amid legal rows with the SEC, the Coinbase-USMS partnership seals the deal concerning trust in the management of seized crypto.

The USMS has selected Coinbase Prime as the custody provider for some digital assets to support the agency’s responsibilities about asset forfeiture. It was announced on July 1 that the Coinbase institutional investing arm would provide custody and advanced trading services for large-cap digital assets in support of central management by the federal agency of all types of assets, including crypto confiscated by the Justice Department.

An audit by the Justice Department published in 2022 previously showed that the Marshals Service was not doing a great job at handling and accounting for cryptocurrency. Thus, USMS began soliciting contracts for crypto custody class services in March. A history with law enforcement would have likely played into that decision since Coinbase Prime can effectively trace its history to custodians or selling crypto seized in criminal investigations—from defunct exchange FTX to the Silk Road platform.

A Strategic Partnership

Apart from the custody offering, Coinbase Prime will also centrally manage assets supporting the USMS. This is just another example of how Coinbase plays a critical role in law enforcement’s handling of digital assets. Government records disclosed that Coinbase Prime won over $32 million for this contract—the heftiest amount—immediately indicating the magnitude of the collaboration.

Of course, Coinbase does not shun ugly cases. So far, the crypto exchange has embarked on a civil suit with the United States Securities and Exchange Commission. The June 2023 lawsuit has been highly polemic because it questions the enforcement approach taken by the SEC. Added to that, recently, the Supreme Court ruled that defendants in securities fraud cases have the right to trial by jury, which could affect Coinbase’s legal strategy.

Court Cases and Regulatory Review

Notably, Coinbase has sued the Federal Deposit Insurance Corporation and the SEC, claiming that they have disregarded requests under the Freedom of Information Act. It joins various lawsuits pitting the crypto community against these ongoing broader regulatory battles.

However, despite these challenges, Coinbase continues to solidify its position in the crypto

Ecosystem. The USMS partnership is a case in point for competence and reliability. Moreover, it underlines Coinbase’s prowess at moving through magna – consequently critical – Strict regulatory environments with its integrity intact.