Coinbase is embroiled in a legal battle with the SEC, which accuses the company of operating as an unregistered securities exchange and violating federal securities laws since 2019.

In response to the ongoing lawsuit, Coinbase filed a motion to compel the SEC to produce documents, including private emails from SEC Chair Gary Gensler, which the SEC has strongly opposed.

The SEC labeled Coinbase's request for Gensler's emails as 'prejudicial' and argued that such internal communications are irrelevant to the case.

The SEC's civil charges against Coinbase include allegations related to the unregistered sale of securities tied to its staking products.

Coinbase's Chief Legal Officer, Paul Grewal, criticized the SEC's regulation by enforcement approach, calling for greater transparency on the agency's stance regarding digital assets.

Coinbase maintains that most cryptocurrencies should be classified as digital commodities rather than securities, challenging the SEC's definitions.

The SEC has already produced over 240,000 documents related to its investigation of Coinbase and is currently reviewing an additional 117,000, but claims that Coinbase's demands could require the production of over 3 million documents.

Despite the SEC's claims of burden and irrelevance, Coinbase continues to seek extensive documentation to support its defense.

During a pre-trial conference, District Judge Katherine Polk Failla expressed surprise and disapproval regarding Coinbase's extensive requests for documents.

The SEC's inconsistent views on the status of digital assets, such as Ether, have drawn scrutiny from the crypto community, further complicating the regulatory landscape.

Crypto users have rallied in support of Coinbase, advocating for transparency from the SEC in its regulatory practices.