Coinbase Is Leaving Delaware After Tesla and A16z, But Why?

Coinbase plans to relocate its corporate registration from Delaware to Texas, citing the state’s more efficient and predictable legal framework. 

The move marks a broader shift as companies increasingly challenge Delaware’s long-standing dominance in corporate law.

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Companies Exit Delaware En Masse

The company filed with the Securities and Exchange Commission (SEC) on Wednesday to reincorporate in Texas, describing the move as a strategic step.

“I’ve had great experiences in Delaware as a lawyer and judicial colleague, but the state no longer has a monopoly on corporate law. And it’s now facing stiff competition from other states that are innovating to offer the right environment for business and innovators to thrive,” Coinbase’s Chief Legal Officer Paul Grewal said in a social media post.

Delaware has long been the preferred home for US corporations, housing nearly two million registered entities and more than half of all publicly traded companies in the United States. In recent years, however, that dominance has started to erode. 

Coinbase now joins Tesla, SpaceX, Andreessen Horowitz, Roblox, and Dropbox in relocating to other states, mainly Texas and Nevada. They cited concerns over unpredictable court rulings and stricter oversight as key reasons for the move.

Texas has recently modernized its business statutes, establishing a specialized business court and codifying stronger protections for company leaders. These changes aim to increase consistency and reliability in corporate governance. 

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Delaware officials have reportedly acknowledged the trend, with Governor Matt Meyer stating that the state is actively reaching out to companies to address their concerns and regain their trust.

Is Texas the New Delaware?

For a company like Coinbase, operating in a fast-moving and highly regulated sector, legal stability is essential. 

Texas offers a predictable framework for technology-driven businesses, supported by pro-innovation leadership and clearer regulations. 

Delaware courts, meanwhile, have expanded scrutiny of corporate leaders, increasing the risk of shareholder lawsuits. This shift particularly drew attention after Elon Musk’s $56 billion Tesla pay package was overturned. 

Texas has responded by passing Senate Bill 29, which codifies the business judgment rule and establishes a Business Court to streamline corporate disputes. 

The move highlights growing competition among states to define the next era of corporate governance. It also helps explain why Texas is emerging as a new favorite hub for crypto companies.