Yesterday, Coinbase CEO Brian Armstrong announced on X (because obviously) that he’s planning to boycott Milbank for having “messed up” in hiring recently departed SEC enforcement chief Gurbir Grewal as a partner in its New York office. While there are warranted concerns over the revolving door between regulators and advising the targets of those regulations — serious issues with the potential impact of placing the responsibility to pursue bad actors upon people hoping to turn around and work for those same actors for millions of dollars — trust that Armstrong is not interested in any of those arguments! He just wants the industry to punish Biglaw firms for hiring anyone involved in the recent wave of crypto regulation.
The crypto industry hates the SEC because the regulator routinely poked at the tension between crypto’s claim to be “just a currency” and its marketing as a surefire investment to the moon — the latter justification sounding an awful lot like a security. Sure, you can use crypto as a currency to launder money, but most crypto holders harbor no intention to use it to purchase heroin off the dark web.
Presumably.
As the Venn diagram of crypto fanatics and Elon Musk stans forms a perfect circle, this isn’t a surprising announcement. Armstrong’s call is reminiscent of Elon Musk’s ultimatum a couple years ago that Cooley LLC fire an associate for having previously worked at the SEC or lose Tesla’s business. Cooley told him to pound sand.
Weird, because I thought clients pressuring firms to distance themselves from partners was “cancel culture.”
The earlier Musk story presents a curious juxtaposition with his current legal crusade that encouraging customer boycotts of major X advertisers amounts to illegal tampering and that the advertisers then refusing to place their ads on the platform violates the Sherman Antitrust Act, if not criminal RICO.
It seems the “free speech absolutist” adheres to the rule of “boycotts for me and not for thee.”
Personally, I’d advise Coinbase, a crypto trading platform, that it’s not great optics to say “we refuse to work with anyone who cracked down on fraudsters selling crypto.” The New York Stock Exchange doesn’t boycott lawyers for busting Ponzi schemes for a reason. A more sensible statement would be, “At Coinbase, we strive to ensure our users are never scammed in the rapidly evolving industry and we welcome working with an experienced regulator who can help advise us to identify bad actors.”
But even if Armstrong’s proposed boycott is stupid, it’s entirely within his rights. It’s also within his rights to encourage others in the industry to join him (there’s a hypothetical point where this could become anticompetitive collusion, but despite the fever dreams of Musk’s advertising complaint — and the sycophants hyping it — none of these boycotts approach that). The nature of free speech and the free market is that you get to spend your money wherever you choose and if the crypto industry doesn’t want to work with senior SEC alumni, that’s their prerogative.
As long as everyone recognizes that door swings both ways.
Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter or Bluesky if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.
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