The US government has chosen Coinbase, an American crypto exchange, to safeguard its digital assets. The U.S. Marshals Service (USMS), a branch of the Department of Justice (DOJ), disclosed that it is utilizing Coinbase to manage and dispose of significant quantities of “Class 1” cryptocurrencies.

“In cooperation with the Asset Forfeiture Division (AFD) of the Department of Justice (DOJ), the U.S. Marshals Service (USMS) requires management and disposal services for large volumes of prominent cryptocurrency assets, categorized as Class 1 cryptocurrencies. This necessitates the use of advanced storage and liquidation methods that adhere to professional standards and comply with Department and USMS policies.

This agreement will streamline the custody, administration, and disposal procedures for cryptocurrency assets, enabling the diversification of managed cryptocurrency types under government forfeiture programs.”

According to official statements, the government has awarded a $32.52 million contract to Coinbase for overseeing this initiative. In a blog post, Coinbase highlighted its extensive experience collaborating with government entities:

“Coinbase has a longstanding commitment to assisting law enforcement agencies, beginning with the establishment of our law enforcement program in 2014. Presently, Coinbase collaborates with all major U.S. federal, state, and local law enforcement agencies, as well as international counterparts across the globe. Fostering the growth of the crypto economy involves promoting secure and efficient markets, with these partnerships playing a crucial role in our mission.”

Despite the government’s utilization of Coinbase for cryptocurrency custody and trading, the U.S. Securities and Exchange Commission (SEC) is currently engaged in a legal battle against the exchange. Allegations suggest Coinbase has been involved in selling unregistered securities. Coinbase’s Chief Legal Officer, Paul Grewal, criticized the SEC’s stance as detrimental to the industry:

“Significantly, the SEC repeatedly asserts that industry compliance with regulations is immaterial. The SEC’s actions appear focused on stifling the digital asset industry, as it refuses to provide the necessary regulatory framework requested by the industry, exacerbating the situation.”

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