United

Prime

The United States Marshals Service (USMS) will use Coinbase Prime to custody certain digital assets as part of the law enforcement agency’s responsibility to handle asset forfeiture.
In a July 1 notice, Coinbase <a href="https://www.coinbase.com/blog/u-s-marshals-service-chooses-coinbase-to-safeguard-trade-its-large-cap" target="_blank" rel="noopener nofollow">said</a> the USMS had selected the exchange’s institutional investing arm “to provide custody and advanced trading services” for large-cap digital assets. The cryptocurrency exchange said it would manage the assets “centrally in support” of the federal agency, which sometimes takes custody of crypto seized by the&nbsp;Department of Justice.
In 2022, the Office of the Inspector General for the Justice Department <a href="https://cointelegraph.com/news/seized-crypto-safe-with-us-marshals-service-not-so-much-new-audit-reveals">released the results</a> of an audit suggesting that the Marshals Service “faced challenges in managing and tracking cryptocurrency.” In March, the USMS reportedly began <a href="https://govtribe.com/opportunity/federal-contract-opportunity/cryptocurrency-managed-services-class-1-15m50024qa4400002" target="_blank" rel="noopener nofollow">exploring</a> contracts for companies to provide crypto custody services.&nbsp;
The U.S.-based crypto exchange Coinbase has a history of being used by law enforcement agencies to custody or <a href="https://cointelegraph.com/news/u-s-government-sends-3-940-bitcoin-coinbase-exchange">sell crypto seized</a> as part of criminal investigations. The U.S. Marshals Service has <a href="https://cointelegraph.com/news/government-court-approval-sam-bankman-fried-private-jets">held assets tied</a> to defunct cryptocurrency exchange FTX and the infamous Silk Road platform. According to government records, Coinbase Prime <a href="https://sam.gov/opp/b0373332814e4eaa85abab779d54317b/view" target="_blank" rel="noopener nofollow">received</a> more than $32 million for the USMS contract.&nbsp;
Related: <a href="https://cointelegraph.com/news/uk-government-seize-crypto-economic-crime-corporate-transparency-act">UK authorities will soon have fewer restrictions when seizing crypto</a>
Coinbase is still involved in a civil lawsuit filed by the U.S. Securities and Exchange Commission in June 2023. The financial regulator’s approach to enforcement cases has come under scrutiny in an election year, with the Supreme Court releasing a decision on June 27 entitling defendants to a jury trial for securities fraud cases.
The crypto exchange also filed lawsuits against the SEC and the Federal Deposit Insurance Corporation, <a href="https://cointelegraph.com/news/coinbase-sues-sec-fdic-foia-requests">alleging that the government agencies</a> failed to comply with Freedom of Information Act requests. 
Magazine: <a href="https://cointelegraph.com/magazine/us-enforcement-agencies-turning-up-heat-crypto-related-crime/">US enforcement agencies are turning up the heat on crypto-related crime</a>

Coinbase will custody digital assets for US Marshals Service

Cointelegraph

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