US Marshals Service Partners with Coinbase

The US Marshals Service (USMS) has partnered with Coinbase Prime to manage and trade large-cap digital assets, in a deal worth $32.5 million. This decision follows a thorough evaluation process by the USMS, a division of the US Department of Justice responsible for asset forfeiture.

Coinbase Prime was chosen for its strong track record and security features. It is a leading platform for institutions to trade and store digital assets securely. As of March 31, 2024, Coinbase held $330 billion in assets and had $256 billion in institutional trading volume for Q1 2024. Since 2014, Coinbase has supported law enforcement, working with major US federal, state, and local agencies, as well as international agencies.

“Coinbase Prime continues to be trusted by the world’s largest institutions and governments because of the quality, security, and track record of our institutional product suite,” Coinbase told BeInCrypto. The US Marshals Service stated that the Coinbase contract will streamline the custody, management, and disposal of cryptocurrency assets. This partnership will also allow for a wider range of crypto assets to be managed and disposed of under the government’s forfeiture programs.

This partnership aligns with Coinbase's goal to promote safe and efficient markets amid increased scrutiny from the Securities and Exchange Commission (SEC) on the crypto industry. The USMS highlighted the benefits of Coinbase’s system, particularly its smart order routing that minimizes market impact and conceals the overall trade size. “Working on an agency basis, clients can be sure our interests are aligned as we seek to find the best prices available in the market,” Coinbase shared.

Despite regulatory challenges from the SEC, this partnership is a significant win for Coinbase. The SEC has intensified its scrutiny on Coinbase and the broader crypto industry, creating regulatory hurdles. In response, Coinbase has filed a lawsuit against the SEC and the Federal Deposit Insurance Corporation (FDIC) to obtain documents on how regulators classify crypto tokens and their actions against the industry.

The partnership with the US Marshals Service highlights Coinbase’s resilience and commitment to its institutional clients. The company continues to deliver secure and reliable services to large institutions and government agencies, demonstrating its ability to navigate regulatory landscapes while expanding its institutional offerings.

Coinbase’s experience in supporting law enforcement and managing large-scale digital assets was key to securing this contract. Its robust infrastructure and security protocols make it a reliable partner for the USMS, ensuring the safe custody and management of seized digital assets.

This partnership will streamline the management and disposal of confiscated crypto assets, providing the USMS with an efficient and reliable solution. The collaboration underscores the importance of strong security measures and reliable infrastructure in handling significant amounts of digital assets.

Coinbase’s smart order routing system minimizes the impact of large trades on the market, ensuring the best prices while maintaining trade confidentiality. This is particularly valuable for the USMS as it manages the disposal of seized assets.

The partnership with the USMS is a strategic move for Coinbase amid ongoing regulatory scrutiny. By aligning with government agencies, Coinbase reinforces its commitment to transparency and compliance in the crypto industry. This collaboration also showcases the company’s ability to provide high-quality services to both private and public sector clients.

In summary, the US Marshals Service’s $32.5 million contract with Coinbase Prime marks a significant milestone in digital asset management. Despite regulatory challenges, Coinbase’s selection highlights its strong track record and ability to provide secure, institutional-grade services. The partnership will enhance the management and disposal of seized digital assets, promoting safe and efficient markets in the evolving crypto economy.