The asset forfeiture division of the US Department of Justice, known as the US Marshal Service, has chosen Coinbase as its custodian for digital assets with considerable market capitalization. Coinbase Prime will provide custody and advanced trading services for the designated 'Class 1' digital assets to aid federal law enforcement agencies. In compliance with the Department of Justice (DOJ) guidelines, reliable storage and liquidation methods are essential for managing and disposing of substantial quantities of commonly used cryptocurrencies known as Class 1 cryptocurrencies.

The collaboration is aimed at streamlining the handling and liquidation process of cryptocurrency assets, allowing a broader spectrum of digital assets to be incorporated into the government's asset seizure strategies. Coinbase has emphasized its extensive experience in supporting law enforcement and forging partnerships with key federal, state, and local entities both domestically and internationally.

Coinbase has come under scrutiny by the US Securities and Exchange Commission (SEC) after receiving 3,940 BTC valued at $241 million from the seizure of funds from drug trafficker Banmeet Singh in January 2024. John E. Deaton, a proponent of cryptocurrencies, criticized the US government's actions as inconsistent, stressing the need for regulatory bodies and government bodies to establish clear and harmonized guidelines to create a more stable and favorable environment for the cryptocurrency industry.

The agreement between Coinbase and the Department of Justice solidifies Coinbase's significant role in the cryptocurrency custody sector and underscores the importance of collaboration between public and private sectors in regulating digital assets. Clarity and uniformity in legislation are essential for fostering an environment that supports the growth and prosperity of the cryptocurrency economy.