Wave Digital Assets, LLC v. United States

In the United States Court of Federal Claims

No. 25-928

Filed: May 13, 2026

Reissued: June 1, 2026 †

WAVE DIGITAL ASSETS, LLC,

Plaintiff,

v.

THE UNITED STATES,

Defendant.

and

COMMAND SERVICES & SUPPORT,

INC.,

Intervenor-Defendant.

Shane J. McCall, with Nicole D. Pottroff, John L. Holtz, Gregory P. Weber, Stephanie L. Ellis,

and Annie E. Birney, Koprince McCall Pottroff LLC, Lawrence, KS, for Plaintiff.

Elinor J. Kim, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of

Justice, Albert Iarrosi, Assistant Director, Patricia M. McCarthy, Director, Brett A. Shumate,

Assistant Attorney General, with C. Joseph Carroll, Senior Associate General Counsel, U.S.

Marshals Service, Washington, D.C., for Defendant.

Francis E. Purcell, Jr., with Joseph R. Berger, and Amaiya Johnson, Thompson Hine LLP,

Washington, D.C., for Intervenor-Defendant.

MEMORANDUM OPINION AND ORDER

TAPP, Judge.

The United States Department of Justice (“DOJ”), jointly with the United States Marshals

Service (“USMS” or “Agency”), urges the Court to affirm an award decision related to a contract

†

This Opinion was originally issued under seal, (ECF No. 65). The Court provided parties with

the opportunity to submit proposed redactions. The Court accepts all proposed redactions. (See

Joint Status Report, ECF No. 68-2). The sealed and public versions of this Opinion differ only to

the extent of those redactions, the publication date, and this footnote.

for the security and storage of seized cryptocurrency. Standing alone, this unremarkable

proposition could result in the issuance of a garden-variety protest decision much like that below.

What sets this litigation apart is that during the pendency of this protest, the United States

charged an employee of the awardee with theft of more than $46 million in cryptocurrency being

held for the USMS.

The Court is narrowly constrained by jurisdiction, statute, and precedent; the Agency,

however, retains alternative solutions it has not chosen to pursue. The Agency’s refusal to act

stands in tension with the seriousness of the events unfolding around the award. Rather than

remaining stoically silent, the Government could have simply asked for a brief stay or voluntary

remand to consider its options. It did nothing. Only now, at the Court’s insistence, has it

responded at all. It stated that, “this individual is alleged to have stolen the cryptocurrency based

on an insider type of position where he allegedly abused his access and no amount of precautions

could have necessarily prevented this type of threat . . . .” (Hr’g Tr. at 10:9–13 (emphasis

added), ECF No. 63). This belated explanation does little to assuage a genuine concern regarding

rampant fraud within our government and yet the United States seems inexplicably committed to

a flawed procurement that has not achieved its stated objective. 1

Even so, the Court’s role is narrower than the circumstances might invite. Constrained as

it is, the Court must resolve the merits based on the record as it existed at the time of award—

before the alleged theft. On that record, this protest fails. Plaintiff, Wave Digital Assets, LLC

(“Wave”), has not shown that the USMS’s initial decision was fatally flawed, despite the

subsequent events. Wave’s Motion for Judgment on the Administrative Record, (Pls.’s MJAR,

ECF No. 42), is DENIED. The United States’ and Intervenor-Defendant’s, Command Services

& Support, Inc. (“CMDSS”), Cross-Motions for Judgment on the Administrative Record, (Def.’s

xMJAR, ECF No. 48; Interv.-Def.’s xMJAR, ECF No. 47), are GRANTED. Resolution of

issues relating to the administration of this ill-fated contract must wait.

I. Background

Asset forfeiture is an essential component of federal law enforcement efforts. “The

USMS is the primary custodian of seized assets[,] . . . [including] cryptocurrency[,]” for the

federal asset forfeiture program. (Administrative Record (“AR”) 3, ECF Nos. 33, 34). The

USMS Solicitation issued a request for proposals (“RFP” or “Solicitation”) for the management

1

The GAO estimates that the United States’s loses between $233 billion and $521 billion

annually to fraud. See https://www.gao.gov/products/gao-24-105833 [https://perma.cc/R3GW-

866D] (last visited May 13, 2026). Some procurement related fraud is well-documented. See

CRAIG WHITLOCK, FAT LEAONARD: HOW ONE MAN BRIBED, BILKED, AND SEDUCED THE U.S.

NAVY (Simon & Schuster, 2024) (multi-million dollar fraud relating to Navy husbanding

contracts).

2

(AR 142–45).

The USMS structured the procurement in two phases: Phase I evaluated Factor 1 and

Phase II evaluated Factors 2–4. Factor 1–Experience (Oral Presentation) was divided into three

subfactors: (A) the oral presentation; (B) the demonstration; and (C) on-the-spot questions. (AR

142–43). Factor 2–Technical Capability/Resumes required offerors to address in writing five

subfactors: (1) Facility and Staffing; (2) Initial Intake; (3) Storage and Management; (4)

Disposal; and (5) Resumes. (AR 143–44). Factor 3–Other Data required offerors to provide

various forms, Organizational Conflict of Interest (“OCI”) certification, Quality Control Plan,

and a Teaming Agreement (if applicable). (AR 144). Factor 4–Price required offerors to submit

original price schedules stating fixed prices for specified bands of transactions. (AR 145).

Ten vendors timely submitted proposals, but only three advanced to Phase II of the

procurement: Wave, CMDSS, and . (AR 1975, 2074). Following the

Technical Evaluation Board’s (“TEB”) evaluation of proposals, the Contracting Officer (“CO”)

determined that discussions were necessary and held discussions from June 26, 2024, to October

25, 2024. (AR 1975–76). After discussions concluded, the TEB reevaluated each of the

proposals and reached the following conclusions:

Factor 1 – Factor 2 –

Overall

Oral Technical Factor 3 – Factor 4 –

Offeror Technical

Presentation Capability / Other Data Price

Rating

/ Experience Resumes

Some Some Some

Compliant

Confidence Confidence Confidence

Some Some Some

CMDSS Compliant $23,076,450.00

Confidence Confidence Confidence

Low

Confidence

Some Low

Wave Compliant

Confidence Confidence Technically

Unacceptable

for Award

(AR 2075). Based on these evaluations, the CO determined it would be in the best interest of the

Government to award the contract to CMDSS rather than on a best value basis, finding that

CMDSS presented a technically superior and lower-priced offer among the two technically

acceptable proposals. (AR 2072–86).

On October 29, 2024, the USMS awarded the contract to CMDSS and notified Wave of

its unsuccessful offer. (AR 2095, 2212). Wave subsequently requested and received a debrief

from the USMS, which included the TEB’s evaluation of Wave’s proposal. (AR 2224–26). On

November 8, 2024, Wave filed a protest with the agency alleging that: (1) CMDSS was

ineligible for award because it had not procured the required licenses and registrations to perform

4

the contract; (2) the USMS improperly disregarded Wave’s assurances that its subcontractor,

, could support all the Class 2–4 cryptocurrency assets required by the Solicitation; and (3)

USMS misevaluated its proposal based upon a misunderstanding of Wave’s proposed

relationship with its subcontractors. (AR 2287). Soon after, Wave filed a supplemental protest

with the agency alleging that CMDSS had an OCI arising from the employment of

by one of its subcontractors, . (AR 2298). The USMS denied both

agency-level protests. (AR 2300–04).

On December 6, 2024, Wave filed a protest with the Government Accountability Office

(“GAO”) alleging that the USMS should have found CMDSS and technically unacceptable

due to their lack of licensing with the Securities and Exchange Commission (“SEC”) and the

Financial Industry Regulatory Authority (“FINRA”), and that the agency failed to adequately

investigate the OCI concerns involving CMDSS. (AR 2305). Approximately two months later,

Wave filed a supplemental protest alleging that the USMS conducted unequal evaluations of the

proposals submitted by and Wave, particularly regarding ability to support Class

2–4 cryptocurrencies. (AR 3039). The GAO’s March 14, 2025 decision denied these protests,

finding the Agency’s evaluations to be reasonable and consistent with the terms of the

Solicitation. (AR 3096–104). Wave filed this current protest two and a half months later.

(Compl., ECF No. 1).

Along with its protest, Wave sought a preliminary injunction, (see Pl.’s Mot., ECF No.

7), which the Court denied before setting a briefing schedule that concluded in mid-January

2026. Wave Digital Assets, LLC v. United States, No. 25-928, 2025 WL 2475370, at *1 (Fed. Cl.

July 30, 2025). Two weeks after the close of briefing, Wave filed a notice informing the Court of

the Government’s investigation into CMDSS’s alleged theft of cryptocurrency entrusted to it by

the USMS. 3 (See Pl.’s First Notice, ECF No. 56). In the notice, Wave included its request for

involvement to the DOJ Office of the Inspector General (“OIG”). (See id. Ex. A, ECF No. 56-1).

Wave’s request to the OIG disclosed the following:

Recent investigative reporting and independent blockchain-forensic analysis,

detailed in numerous articles attached as Exhibit A, describe a scheme in

which an individual allegedly boasted on Telegram about accessing and

draining wallets associated with U.S. government seizures, activity that

ultimately enabled investigators to trace on-chain transactions back to USMS

seized assets. The claimed losses from this alleged theft are immense,

3

As explained below, the Court reviews bid protests and makes necessary factual findings on an

administrative record. Axiom Res. Mgmt., Inc. v. United States, 564 F.3d 1374, 1381 (Fed. Cir.

2009); see Bannum, Inc. v. United States, 404 F.3d 1346, 1353–54 (Fed. Cir. 2005). Except in

limited circumstances, that record is confined to what was before the agency at the time of

decision, a restriction designed to prevent courts from using new evidence to “convert the

‘arbitrary and capricious’ standard into effectively de novo review.” AgustaWestland N. Am., Inc.

v. United States, 880 F.3d 1326, 1331 (Fed. Cir. 2018) (quoting Axiom, 564 F.3d at 1379–80).

The Court recounts the post-decision procedural history here not as a factual determination, but

to ensure full transparency regarding the materials filed of record.

5

(Id. at 12:8–21 (Counsel for the United States affirming the USMS’s position that the matter is a

“contract administration issue . . . [and] not meaningful for the Court to consider[.]”)). 7 The

Court agrees. 8 The alleged theft relates to the performance of the contract, not the agency’s

award decision, and thus falls outside the scope of what the Court may consider in resolving this

protest.

II. Analysis

Wave alleges that the USMS made numerous errors in its evaluation of offers under the

Solicitation. (See generally Compl.; Am. Compl., ECF No. 41). Each of Wave’s arguments have

been considered, but they do not form a basis to overturn the USMS’s decision.

A. Jurisdiction and Standard of Review

The Court typically reviews agency procurement decisions under the Administrative

Procedure Act (“APA”), 5 U.S.C. § 706. Under the APA standard, “[i]n a bid protest case, the

inquiry is whether the agency’s action was arbitrary, capricious, an abuse of discretion, or

otherwise not in accordance with law and, if so, whether the error is prejudicial.” Glenn Def.

Marine (ASIA), PTE Ltd. v. United States, 720 F.3d 901, 907 (Fed. Cir. 2013).

Judicial review of agency action under the APA typically proceeds on two tracks; the

Court could find: (1) the agency’s decision lacked either a rational basis or support from the

administrative record or was arbitrary and capricious; and/or (2) the agency’s procurement

procedure involved a violation of regulation or statute. Weeks Marine, Inc. v. United States, 575

F.3d 1352, 1358 (Fed. Cir. 2009). To obtain relief, after showing that the procuring agency

violated the law or acted arbitrarily and capriciously, the protester must also show that the

agency’s violation was prejudicial. Glenn Def. Marine (ASIA), 720 F.3d at 907. This standard is

“highly deferential.” CHE Consulting, Inc. v. United States, 552 F.3d 1351, 1354 (Fed. Cir.

2008). “Under the ‘arbitrary and capricious’ standard[,] the scope of review is a narrow one. A

reviewing court must consider whether the decision was based on a consideration of the relevant

factors and whether there has been a clear error of judgment.” Bowman Transp., Inc. v.

Arkansas-Best Freight Sys., Inc., 419 U.S. 281, 285 (1974) (internal quotations omitted). The

Court may not substitute its own judgment for that of the agency. Id. But the agency must

articulate a “rational connection between the facts found and the choice made.” Burlington Truck

Lines, Inc. v. United States, 371 U.S. 156, 168 (1962). Even so, a “protestor’s burden is

particularly great in negotiated procurements because the contracting officer is entrusted with a

7

Fourteen days after the Hearing, the United States formalized its position by filing a Notice

reiterating its view that the alleged misconduct concerns contract administration rather than the

propriety of the award decision and continuing to urge the Court to affirm the award. (See Def.’s

Notice, ECF No. 64).

8

Claims regarding contract administration cannot be brought under the Tucker Act. 28 U.S.C. §

1491(b)(1). Such claims fall under the Contract Disputes Act. 41 U.S.C. § 7101 et seq.; see also

Dalton v. Sherwood Van Lines, Inc., 50 F.3d 1014, 1017 (Fed. Cir. 1995) (“When the Contract

Disputes Act [(“CDA”)] applies, it provides the exclusive mechanism for dispute resolution[.]”).

7

relatively high degree of discretion, and greater still, where . . . the procurement is a ‘best-value’

procurement.” Banknote Corp. of Am., Inc. v. United States, 56 Fed. Cl. 377, 380 (2003), aff’d,

365 F.3d 1345 (Fed. Cir. 2004).

When reviewing an agency’s procurement decisions, the Court is expected to apply a

“presumption of regularity” and avoid substituting its own judgment for that of the agency. See

Cleveland Assets, LLC v. United States, 883 F.3d 1378, 1382 (Fed. Cir. 2018); R & W Flammann

GmbH v. United States, 339 F.3d 1320, 1322 (Fed. Cir. 2003). Additionally, “[i]f the court finds

a reasonable basis for the agency’s action, the court should stay its hand even though it might, as

an original proposition, have reached a different conclusion as to the proper administration and

application of the procurement regulations.” Honeywell, Inc. v. United States, 870 F.2d 644, 648

(Fed. Cir. 1989) (quoting M. Steinthal & Co. v. Seamans, 455 F.2d 1289, 1301 (D.C. Cir. 1971)).

“For that reason, procurement decisions ‘invoke[] ‘highly deferential’ rational basis review[.]’”

Savantage Fin. Servs., Inc. v. United States, 595 F.3d 1282, 1286 (Fed. Cir. 2010) (citation

omitted).

All parties move for judgment on the Administrative Record. See RCFC 52.1. Unlike the

standard applied in summary judgment motions, “the existence of genuine issues of material fact

does not preclude judgment on the administrative record” under RCFC 52.1. Tech. Sys., Inc. v.

United States, 98 Fed. Cl. 228, 242 (2011); see also RCFC 56. Rather, the Court’s inquiry

focuses on whether, “given all the disputed and undisputed facts, a party has met its burden of

proof based on the evidence in the record.” A&D Fire Protection, Inc. v. United States, 72 Fed.

Cl. 126, 131 (2006) (citing Bannum Inc. v. United States, 404 F.3d 1346, 1356 (Fed. Cir. 2005)).

Well-founded concerns, premised on the now-apparent vulnerability of seized

cryptocurrency entrusted to contractors, present issues arising mid-performance. That concern,

however legitimate, does not justify relief under the Court’s bid protest jurisdiction. Bid protest

review focuses on, and is limited to, the procurement official’s decision or the procurement

procedure rather than subsequent events occurring during contract performance. Glenn Def.

Marine (ASIA), 720 F.3d at 907. As it relates to the contract under which the alleged theft

occurred, Wave lacks privity with the United States, and that absence of privity forecloses any

claim under the CDA. The CDA provides a remedial path only for “contractors,” meaning

entities in direct contractual relationship with the government. Winter v. FloorPro, Inc., 570 F.3d

1367, 1369 (Fed. Cir. 2009). Wave was not the awardee and never entered into a contract with

the USMS; accordingly, it could not have asserted a CDA claim even if it believed the agency’s

conduct during performance was improper. See Admiralty Constr., Inc. v. Dalton, 156 F.3d 1217,

1220 (Fed. Cir. 1998) (limiting CDA claims to contractors). Accordingly, Wave’s claims fall

exclusively under the Court’s review of the CO’s award decision.

B. Discussions and Timing

Wave’s primary argument relates to discussions held with the offerors. (Pl.’s MJAR at

18–29). First, Wave asserts that the USMS engaged in misleading discussions by failing to

provide Wave with timely notice of concerns in its proposal. (Id. at 20–23). Next, Wave alleges

that the USMS did not give Wave a meaningful opportunity to respond to its final discussion

requests. (Id. at 23–27). Third, Wave argues that these errors were prejudicial. (Id. at 27–29).

8

Section 2.1, “Custody,” of the Performance of Work Statement (“PWS”) stated that the

“Contractor shall remain capable of taking custody, and managing, all types and quantities of

cryptocurrency, described as Class 2-4 without limitation, throughout the performance of this

contract.” (AR 152). Wave’s proposal indicated that its subcontractor, , would be

responsible for “custodial solutions[;]” specifically, the storage of seized cryptocurrency assets

from the USMS on its platforms. 9 (AR 1510, 1524–25). If specific assets were not supported by

storage platforms, Wave proposed that “ will use custodial hardware wallets as an

intake solution.” (AR 1525). However, Wave acknowledged that this approach would not

constitute “Qualified” custody, as such hardware wallets are neither covered by

insurance policy nor included within its SOC audits. (AR 1525).

Consistent with this limitation, during the first round of discussions on June 26, 2024, the

USMS advised that Wave’s proposed approach was insufficient, as it did not meet the PWS

requirements for insured custody and inclusion in SOC audits. (AR 1951, 1960). To address this

deficiency, Wave proposed swapping unsupported assets into more liquid, widely supported

assets, stating:

Wave understands that, per the PWS, USMS expects that many or all of the

Class 2 and Class 4 assets cannot be liquidated on or supported by the major

exchanges/platforms, and expects that Wave will exchange such USMS

Assets for assets that are supported by major exchanges/trading platforms (a

“USMS Asset Swap”). Wave expects that many assets that are not supported

by the platform (“Unsupported Assets”) will also not be supported by

major exchanges/trading platforms. Accordingly, Wave generally expects

that many of the Unsupported Assets will be converted into assets supported

by (“Supported Assets”), per the PWS and as instructed by USMS.

(AR 1952 (emphasis in original)). It is at this point, Wave alleges, that the USMS “came under

the impression that Wave planned to immediately swap unsupported assets upon receipt without

USMS approval.” (Pl.’s MJAR at 21 (emphasis added)).

The USMS held a second round of discussions with Wave, specifically asking about “the

fee structure associated with liquidating cryptocurrency assets[, whether] fees [would be] taken

directly from the asset[, and] if so, at what percentage rate in basis points.” (AR 1966). Wave

makes two points from this inquiry, first that the USMS acknowledged these were indeed

‘discussions’” and second, that the inquiry failed to provide any indication that Wave’s

“unsupported assets swapping plan was an issue.” (Pl.’s MJAR at 21–22).

Finally, the USMS held a third round of discussions, where it stated the following:

Your responses to questions 3, 6, 9, and 12 require the swapping of

cryptocurrency assets for types supported by the BitGo platform to meet

9

Wave’s proposal identified as “a US-based leader in digital asset security and custody”

whose platform is capable of instantly creating “wallets and addresses to . . . receive and

segregate assets for custody and reporting.” (AR 1511, 1514).

9

insurance requirements, SOC requirements, creation of wallet address and

notifications of non-supported by platform and returns of assets not

supported by platform. As indicated by PWS sections 1.3 Objective,

2.1 Custody, 2.3.10.1 Use of Government Assets, 2.4.2 Exchange into More

Liquidate Crypto and Q&A responses posted on 04/11/2024 and 04/17/2024

(listed below) this is not a viable solution because the PWS does not permit

swapping of assets prior to disposal. Do you have an alternative solution?

A response is required NLT Friday, October 25th at 5:00 pm ET.

(AR 1969 (emphasis in original)). That same day, Wave responded, stating:

Taking this into account, we confirm that there is no need for an alternative

solution. Our subcontractor platform will support all assets, and there

is no need for the swapping of assets prior to disposal or otherwise in order

to meet the requirements outlined in the PWS.

(AR 1971). Despite Wave’s affirmation of abilities, the USMS did not award it the

contract.

The USMS’s debrief included Wave’s portion of the TEB report. (AR 2908). The TEB

report provided several reasons for the rating received. (AR 2907–08). Importantly, the TEB

noted a “Confidence Decrease” in Wave’s proposal, stating:

Assets held in hardware wallets are not covered by insurance policy

nor included in SOC audits. This is a significant risk since these assets are

unaudited and uninsured (risk). We need to know which potential hardware

wallets are being considered (are they based in US), and we need detailed

info on the security measures and protocols in place to protect these assets

(how are the wallet addresses generated and how are these assets monitored).

To mitigate this risk, Wave is proposing to convert these assets with the

permission of USMS. This does not meet the PWS requirements. Assets need

to be held in its original form until forfeiture (risk)[.]

(Id. (emphasis in original)). The USMS went on to discuss the effect that the rounds of

discussions had on the evaluation:

Post Discussion Questions Evaluation (1st Round): Wave expects that any

unsupported assets will be exchanged via USMS Asset Swaps, sold, or

burned and will be supported on custody platform and does not plan

the use of hardware wallets. This is not a viable solution for the USMS as

assets must remain in their current form until an authorizing document is

received during the adjudication of the case (risk).

Post Discussion Question Evaluation (2nd Round): After repeatedly being

informed that the swapping and/or converting of cryptocurrency assets to use

their identified custodian was not a viable option, Wave indicated that their

custodian, , would be able to support all cryptocurrency assets, thus

10

being able to use platform for intake. However, Wave failed to

provide any details related to how this is possible and how this would change

their proposal. Furthermore, the list of supported assets on website

shows they do not support

numerous cryptocurrency assets categorized as Class 2-4 (e.g., Bitcoin SV,

Ark, VeThor, VeChain, Hashflow). There is low confidence that Wave would

be successful, even with government intervention.

(AR 2908). 10 It is primarily from this chain of events that Wave’s contentions arise.

1. The USMS’s discussions were not misleading.

Wave argues that the USMS’s discussions with Wave were misleading. (Pl.’s MJAR at

20–23). Wave claims that the USMS first “came under the impression that Wave planned to

immediately swap unsupported assets upon receipt without USMS approval” after the first round

of discussions. (Id. at 21). Wave argues that when the USMS initiated a second round of

discussions, the CO was obligated to identify concerns with Wave’s proposal, including any

deficiencies, significant weaknesses, or adverse past performance information to which Wave

had not yet had an opportunity to respond. (Id. (citing FAR 15.306(d)(3))).

The United States argues that discussions are not misleading unless they misdirect the

offeror as it revises its proposal or “are incorrect, confusing[,] or ambiguous.” (Def.’s xMJAR at

13 (quoting DMS All-Star Joint Venture v. United States, 90 Fed. Cl. 653, 670 (2010) and

Greenland Contractors I/S v. United States, 131 Fed. Cl. 216, 225 (2017))). The United States

asserts that the only instance of misleading arose when Wave asserted “that could support

all cryptocurrency assets[,]” which was determined not to be accurate based on the USMS’s

review of website. (Id. at 14). The Court agrees with the United States.

If the Government determines that discussions should be held, it must hold discussions

with each offeror in the competitive range of a negotiated procurement. FAR 15.306(d)(1). In

addition, the CO should:

[I]ndicate to, or discuss with, each offeror . . . deficiencies, significant

weaknesses, and adverse past performance information to which the offeror

has not yet had an opportunity to respond. The [CO] also is encouraged to

discuss other aspects of the offeror's proposal that could . . . be altered or

explained to enhance materially the proposal’s potential for award.

FAR 15.306(d)(3). Discussions should be meaningful, but “they do not require the agency to

identify each and every item that could be raised as to improve its proposal.” iAccess Tech., Inc.

v. United States, 143 Fed. Cl. 521, 537 (2019) (citing Carahsoft Tech. Corp. v. United States, 86

10

While the TEB Report’s second Post Discussion Question Evaluation includes the

characterization of “(2nd Round),” this more accurately refers to the third round of discussions

which occurred on October 24, 2024. Commentary on the second round of discussions, which

occurred on September 6, 2024, do not appear in the TEB report. (See AR 2908).

11

Fed. Cl. 325, 343 (2009)). Furthermore, the CO sets the scope and extent of discussions as a

matter of judgment. FAR 15.306(d)(3). This discretion, however, does not give the agency a

license to mislead an offeror. DMS All-Star, 90 Fed. Cl. at 669–70.

In this case, PWS § 2.1 (Custody) covered the contractor’s custodial obligations under

the contract. (AR 152). Specifically, Section 2.1 explains that “[t]he seizure of assets is often

completed with little to no notice” and therefore explicitly requires the Contractor be “capable of

taking custody, and managing, all types and quantities of cryptocurrency, described as Class 2–4

without limitation” (Id.). Additionally, PWS § 2.3.10.1 (Use of Government Assets) provided

that “[t]he Contractor shall not swap, stake, pledge, hypothecate, borrow, invest, assign, convey,

lend, or make other use of Government assets in the Contractor’s possession, nor shall any

cryptocurrency held for the Government be assigned for the benefit of creditors.” (AR 155).

PWS § 2.4 (Disposal) established methods through which the contractor could dispose of

cryptocurrency assets following approval. (AR 156). Once the USMS determined that a specific

cryptocurrency was approved for disposal, it would notify the contractor which assets to dispose

of. (Id.). PWS § 2.4 provided several methods of disposal, including: 1) direct exchange from

cryptocurrency into fiat currency; 2) exchange into a more liquidate form of cryptocurrency

which would subsequently be exchanged for United States dollars; or 3) returning the asset to the

agency. (Id.). Regarding these methods, the PWS specifically noted that many Class 2 and Class

4 assets were not supported by most exchanges and therefore stated that “[i]n [those] instances,

the Contractor shall provide a plan to exchange the cryptocurrency for a cryptocurrency that is

supported by the Contractor’s exchange platform.” (AR 157). If the contractor determined that

the disposal methods were not feasible, it would be required to provide a written explanation of

mitigating factors and provide an alternative method, explanation of the choice, and any resulting

changes in pricing. (AR 156). Notably, these disposal methods are available to the contractor

only after Government approval.

Wave’s initial plan to manage unsupported assets was to use custodial hardware wallets,

which it acknowledged fell short of “Qualified” custody. (AR 1525). As a mitigation measure,

Wave proposed converting such assets, subject to the USMS’s approval, into supported assets

“as quickly as possible.” (Id.). However, this approach is inconsistent with the PWS requirement

that the contractor be capable of taking custody of, and managing, all types and quantities of

cryptocurrency, including Class 2–4 assets, without limitation. (See AR 152). Because Wave

elected not to offer a custody plan that met the requirements of the PWS, the USMS could have

rejected Wave’s proposal at this juncture. See FAR 15.305(a) (stating that agencies must

evaluate proposals “solely on the factors and subfactors specified in the solicitation”); see

also Ashbritt, Inc. v. United States, 87 Fed. Cl. 344, 374 (2009) (“[P]roposals must be evaluated

in accordance with the terms of the solicitation.”). Instead, the TEB, having “identified

significant concerns within all the solutions proposed,” decided to open discussions. (AR 1992).

For example, Question 3 of the USMS’s discussions asked Wave whether it could obtain

insurance coverage for all assets, as required by the PWS, given that its proposal indicated that

some assets (those not supported by custody) would be stored in uninsured hardware

wallets. (AR 1951). Wave’s response stated that hardware wallets would no longer be required

because:

12

[A]ny Unsupported Assets will generally have been (i) converted to a

Supported Asset in an Asset Swap; (ii) otherwise sold, with proceeds returned

to USMS or held in stablecoins; or (iii) burned. And, to the extent any unique

Unsupported Assets exist for which Wave and USMS believe it would be

prudent for USMS to maintain in their current form (and not swap, sell, or

burn them), and if is permitted by its regulators to support such assets,

the appropriate insurance coverage will be provided.

(AR 1953–54). Essentially, Wave planned to convert unsupported assets into supported assets,

sell them and return or hold the cash, or get rid of them entirely, effectively eliminating the need

for insurance. Only in those “unique” cases, where an asset was required to remain in its original

form, would “the appropriate insurance coverage” be provided, though how Wave would do this,

given that its hardware wallets were uninsured, was absent from the explanation. While the Court

agrees that the TEB’s question, like the others Wave identified, never explicitly informed Wave

that its plan to swap cryptocurrency was inadequate, it is equally true that the TEB never

indicated that such a plan could meet the requirements of the PWS. 11

Wave’s suggestion that the USMS’s questions regarding the swapping of unsupported

assets indicated an interest in its proposed approach is equally unsupported, particularly given that

swapping was, in any event, one of the many functions the agency expected contractors to perform

upon receiving Government approval to dispose of certain cryptocurrency assets. (See Pl.’s Resp.

at 8, ECF No. 50). Nothing in the record supports Wave’s allegation that the USMS misled it.

2. The USMS’s discussions were meaningful.

11

Several additional questions that have been identified by Wave include the following:

USMS Question 6: Proposal states that assets held on hardware wallets are

not included in SOC audits. This is not a viable solution, what other options

are there?

...

USMS Question 9: Please provide details on how wallet addresses are

created and specify the names of the wallet providers when using a custodial

hardware wallet. Will USMS be notified if the asset is not supported on

platform?

...

USMS Question 12: How are assets, not supported by , custody

platform returned?

(AR 1960–64 (emphasis in original)).

13

Continuing along its line of reasoning, Wave asserts that the USMS failed to give Wave a

meaningful opportunity to respond. (Pl.’s MJAR at 23–27). Specifically, Wave argues that the

USMS waited until October 24, the third round of discussions, to raise concerns about Wave’s

plan for swapping cryptocurrencies and subsequently only allowed “a single day to completely

retool” its approach. (Id. at 24). Wave claims this timeframe was unreasonable as the USMS’s

questions concerned “aspects of practically every specific requirement under the PWS.” (Id. at

25). Next, Wave belabors the Court with explanations of how difficult it would be to revise its

proposal, the amount of time consumed to develop its original proposal, and how Wave bears no

fault in this regard. (Id. at 26–27).

The United States rebuts these arguments by first pointing out that Wave “knowingly

submitted a proposal that deviated from the PWS requirements.” (Def.’s xMJAR at 12).

Specifically, the United States notes that Wave’s proposal acknowledged that it relied on a

deviation from the terms of the PWS, stating that:

[S]ome obscure tokens requiring hardware wallet solutions would not be

feasible under the proposed plan included in the Proposal. In order to breach

the gap for these obscure tokens, Wave would request a permitted deviation

from the Proposal for such specific tokens for a period of up to 3 months upon

initial transfer, to convert them into an asset that would be viable to hold

through/by a qualified custodian.

(Id. (quoting AR 1611–12)). 12 According to the United States, this plan directly violates section

2.3.10.1 of the PWS which explicitly stated that the contractor could “not swap, stake, pledge,

hypothecate, borrow, invest, assign, convey, lend, or make other use of Government assets in the

Contractor’s possession.” (Id. at 13 (quoting AR 155)).

The United States further asserts that the USMS’s discussions with Wave were

meaningful, “because they adequately allowed Wave to further amplify its proposed solution to

allow USMS to determine whether Wave’s proposal was indeed technically unacceptable for

award.” (Def.’s xMJAR at 13). First the United States highlights that, based on the discussions,

the CO determined that “[Wave’s] solution is not viable without major revisions to meet the

requirements of the PWS[,]” specifically, it “lack[ed] a sufficient plan for cryptocurrency assets

that are not traditionally supported by platforms like without some form of

manipulation[.]” (AR 1976). Therefore, according to the United States, the USMS had no

obligation to allow Wave to submit a revised proposal. (Def.’s xMJAR at 13 (citing

FAR15.307(a))). The Court agrees.

To be meaningful, discussions must “generally lead offerors into the areas of their

proposals requiring amplification or correction, which means that discussions should be as

12

It may be worth noting that Wave does not seem to dispute that it proposed an immediate

swapping plan for unsupported assets. (See Pl.’s Resp. at 5 (“[T]he government acknowledges

Wave proposed an immediate swapping plan, which was the very issue that the Agency found to

create a deficiency.”)).

14

specific as practical considerations permit.” D & S Consultants, Inc. v. United States, 101 Fed.

Cl. 23, 40 (2011) (internal citations omitted). This does not mean, however, that the agency must

address “every matter at issue in the universe of information it can often consider.” Sterling Med.

Assoc.’s, Inc. v. United States, 177 Fed. Cl. 550, 562 (2025); see also WorldTravelService v.

United States, 49 Fed Cl. 431, 439 (2001) (noting agency not required to “spoon feed” an offeror

every item in need of revision to improve proposal.). Generally, a protestor should be given at

least one meaningful opportunity to respond to significant weaknesses. Sentrillion Corp. v.

United States, 114 Fed. Cl. 557, 570 (2014).

Wave’s initial proposal included using “hardware wallets as an intake solution” for

unsupported cryptocurrency assets. (AR 1525). However, as noted above, Wave was aware that

these hardware wallets lacked adequate insurance coverage and were not included in SOC audits.

(Id.). If the wallets had been properly insured and audited, assets stored in them could potentially

have been recognized as “Qualified” custody under the PWS. Because they were not, the USMS

identified this as a deficiency during discussions and specifically asked Wave to provide “any

insurance options to meet the requirements of the PWS.” (AR 1951). Rather than addressing this

insurance gap directly, Wave abandoned the hardware wallet approach altogether and instead

proposed a solution that relied primarily on swapping unsupported assets. (See AR 1951–54

(“[T]he use of custodial hardware wallets is no longer anticipated.”)).

The Court finds that the USMS adequately identified the deficiencies in Wave’s proposal.

Although the Agency did not specifically flag Wave’s asset-swapping approach during the initial

round of discussions, it clearly advised that the proposed use of uninsured hardware wallets

failed to meet the PWS requirements. As a result, the discussions were meaningful and satisfied

the USMS’s obligations under the FAR. D & S Consultants, Inc., 101 Fed Cl. at 40 (citing FAR

15.306(d)(3)). While Wave’s response to these concerns was ultimately inadequate, its

alternative plan did not oblige the USMS to provide a second opportunity to revise its proposal.

Wave was given a meaningful opportunity to respond and, therefore, its argument fails.

Sentrillion Corp., 114 Fed. Cl. at 570.

3. The USMS’s decisions were not prejudicial.

To obtain relief, after showing that the procuring agency violated the law or acted

arbitrarily and capriciously, the protester must also demonstrate that the violation was

prejudicial. Because Wave has failed to show that the USMS either engaged in misleading

discussions or failed to conduct meaningful discussions, it cannot establish prejudice, and its

claim fails on that basis. See Glenn Def. Marine (ASIA), 720 F.3d at 907.

C. Disparate Treatment of Proposals

Wave next argues that the USMS engaged in disparate treatment of Wave’s and

proposals under Factor 2–Technical Rating and their overall capability ratings. (Pl.’s MJAR at

29–34). Wave claims that it received a “Low Confidence” rating and thus lost out on the contract

award solely because its proposal “lack[ed] details of a sufficient plan for cryptocurrency assets

that are not traditionally supported by platforms like without some form of manipulation.”

(Id. at 29 (citing AR 2054)). In comparison, when the USMS asked for details regarding

unsupported assets, response stated that its “engineering group concluded that

15

To set the stage for its argument, Wave first claims that “cryptocurrency assets . . . are

securities” according to the SEC and case law. (Id.). Next, Wave points to the Investment

Advisers Act of 1940 (“Advisers Act”) which defines an “investment adviser” as:

[A]ny person who, for compensation, engages in the business of advising

others, either directly or through publications or writings, as to the value of

securities or as to the advisability of investing in, purchasing, or selling

securities, or who, for compensation and as part of a regular business, issues

or promulgates analyses or reports concerning securities.

(Id. at 38 (quoting 15 U.S.C. § 80b-2)). Relying on this definition, Wave contends that the

Solicitation’s requirements, such as directing the contractor to “recommend and advise on the

proper classification of new cryptocurrencies seized” and to “make recommendations regarding

the most prudent method of disposal[,]” bring the awardee within the scope of an “investment

adviser” under the Advisers Act. (AR 151, 156).

From here, Wave argues that investment advisers must obtain appropriate licensure from

the SEC under the Advisers Act and further notes that compliance may also involve state-

specific regulatory requirements, such as money transmitter licenses (“MTLs”). 13 (Pl.’s Mot. at

38). Wave further asserts that both CMDSS and lacked the necessary licenses at the time

of their proposals and could not reasonably obtain them before performance. (Id.). According to

Wave, the USMS failed to adequately consider this issue in its evaluation.

The United States responds that submitting proof of licenses was not a requirement set

forth in the Solicitation, and therefore offerors were not evaluated on whether they had obtained

any particular license. (Def.’s xMJAR at 19). The United States further notes that Wave has

failed to identify any provision in the Solicitation imposing a specific licensing requirement.

The Court finds Wave’s argument relies on several assumptions: (1) that cryptocurrency

assets are necessarily “securities” (2) that the Solicitation’s advisory functions make the awardee

an “investment adviser” under the Investment Advisers Act of 1940 and (3) that this, in turn,

triggers specific SEC and state licensing requirements that the USMS was required to evaluate

during the course of this procurement. Even if each step were plausible, Wave still faces a

fundamental problem in procurement law, “that proposals must be evaluated in accordance with

the terms of the solicitation[,]” not unstated requirements. AshBritt, Inc. v. United States, 87 Fed.

Cl. 344, 374 (2009). Wave has failed to identify any additional terms or provisions within the

Solicitation that would cause this Court to change its decision issued during the preliminary

injunction phase of this protest. See Wave Digital Assets, LLC v. United States, 2025 WL

2475370 at *6 (Fed. Cl. 2025). The Solicitation did not require proof of licensure and Wave

13

Plaintiffs explain that MTLs “are state-specific regulatory requirements for businesses

handling the transfer of money. (Pl.’s MJAR at 38).

19

G. Wave Fails to Satisfy the Requirements for Injunctive Relief

In conclusion, Wave asks the Court to either direct the USMS to terminate the contract

with CMDSS and award it to Wave, or to declare the evaluation and award to CMDSS improper

and conduct its own re-evaluation of Wave’s and proposals while excluding CMDSS due

to the alleged OCI. (Pl.’s MJAR at 43–44). Because the Court has found in favor of the United

States on all issues discussed, further analysis of this request is unnecessary, a point that Wave

acknowledged in its Response. (Pl.’s Resp. at 25 (“[I]f this Court were to side with [the United

States] on the above matters, there is no need to address this issue.”)).

III. Conclusion

The juxtaposition of the legal propriety of this protest with alleged criminal conduct

occurring in close temporal proximity is, at a minimum, notable. The implications extend beyond

mere irony. As previously discussed, the Indictment includes a criminal forfeiture count, and the

forfeited cryptocurrency is stored by the USMS pursuant to its contract with CMDSS—the same

contractor whose employee is alleged to have engaged in the misconduct. The optics are

undeniably poor, but the concern is not, as the government suggests, confined to optics alone.

(Hr’g Tr. at 9:16–17). Even so, these considerations lie beyond what this protest permits the

Court to resolve. The distinction between the Court’s protest jurisdiction and contract

administration is plain. The Court rules accordingly.

Wave fails to demonstrate any prejudicial error in this procurement such that relief could

be awarded. For the reasons stated, Wave’s Motion for Judgment on the Administrative Record,

(Pl.’s MJAR, ECF No. 42), is DENIED. The United States’ and CMDSS’s Cross-Motions for

Judgment on the Administrative Record, (Def.’s xMJAR, ECF No. 48; Interv.-Def.’s xMJAR,

ECF No. 47), are GRANTED. The Clerk is DIRECTED to enter judgment accordingly. The

parties shall meet and confer and file a Joint Status Report proposing redactions to this

Memorandum Opinion within fourteen (14) days of its entry to allow the Court to file a public

version of the Opinion.

IT IS SO ORDERED.

s/ David A. Tapp

DAVID A. TAPP, Judge

23