The United States government has announced that it will be utilizing the services of American cryptocurrency exchange Coinbase for the custody of its digital assets.
As part of a program to manage and dispose of large amounts of “Class 1” cryptocurrencies, the U.S. Marshals Service (USMS), a division of the Department of Justice (DOJ), has disclosed that it has chosen Coinbase to serve as the custodian for these assets.
In a statement, the USMS stated, “The U.S. Marshals Service (USMS) Department of Justice (DOJ), on behalf of the Asset Forfeiture Division (AFD) has a requirement for managing and disposing of large quantities of popular cryptocurrency assets, known as Class 1 cryptocurrencies. This will require the use of multiple, industry-leading storage and liquidation techniques employed in a professional, lawful, and consistent manner with Department and USMS policy.
Furthermore, this contract will simplify the custody, management, and disposal processes for cryptocurrency assets, while also allowing for the diversification of the types of cryptocurrency assets that can be managed and disposed of under the Government’s forfeiture programs.”
The government has confirmed that it has entered into a $32.52 million contract with Coinbase to oversee this program.
In a blog post, Coinbase highlighted its extensive experience in working with government agencies, stating, “Coinbase has a longstanding history of supporting law enforcement agencies, dating back to the founding of our law enforcement program in 2014. Today, Coinbase collaborates with every major U.S. federal, state, and local law enforcement agency, as well as international agencies across all continents. Growing the cryptoeconomy involves promoting safe and efficient markets, and these partnerships are crucial to our mission.”
Despite the government’s partnership with Coinbase for managing cryptocurrencies, the U.S. Securities and Exchange Commission (SEC) is currently embroiled in a lawsuit against the exchange over allegations of selling unregistered securities.
Paul Grewal, Coinbase’s chief legal officer, has criticized the SEC’s actions, accusing the commission of attempting to stifle the industry. Grewal stated, “Remarkably, the SEC says – repeatedly – that it doesn’t matter if the industry can comply with the rules. The SEC is determined to suffocate the digital asset industry and is unwilling to provide the necessary regulations that the industry has requested to alleviate the pressure.”
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