SEC Withdraws Crypto Enforcement, Reassigns Attorney
The U.S. Securities and Exchange Commission (SEC) is reducing its focus on cryptocurrency enforcement by reassigning lawyers from its crypto unit to other roles within the agency. The move follows President Donald Trump’s recent executive order to boost the cryptocurrency industry and ease regulation of digital assets.
SEC to downsize crypto enforcement
The SEC will downsize its special unit of more than 50 lawyers and staff, which was created to oversee and enforce cryptocurrency regulations, according to a report from the New York Times. Some of those have been transferred to other divisions, while one of the unit’s top lawyers has left the crypto unit entirely.
Meanwhile, crypto-friendly SEC Acting Chairman Mark Uyeda has appointed new officials and reshuffled key positions at the agency, which has more than 1,000 lawyers. Uyeda also established a task force to review the SEC’s approach to digital assets, led by Commissioner Hester Peirce, a longtime crypto advocate.
A Shift in the SEC’s Approach
In a recently released statement, SEC Commissioner Hester Peirce criticized the agency’s past approach to cryptocurrency regulation, noting that the SEC’s previous cryptocurrency policies were legally unclear and commercially impractical, leading to ongoing litigation, delayed rules, and market uncertainty.
Peirce also outlined the goals of the newly formed Cryptocurrency Task Force: creating a balanced regulatory framework that fosters innovation while preventing fraud. The commissioner highlighted new regulatory approaches, including potential temporary relief for token issuers to enable compliant trading, revisions to the current securities registration process for crypto companies, clarification on issues such as staking, lending, custody, and ETFs related to crypto, and exploration of international regulatory cooperation.
While regulatory changes will take time, the new Crypto Task Force will provide greater clarity for the crypto industry, according to Peirce. The commissioner’s comments signal a shift in the SEC’s approach to digital assets, moving away from the aggressive enforcement strategy under former Chairman Gary Gensler. Gensler’s tenure saw dozens of enforcement actions against crypto companies, the most high-profile being the SEC v. Ripple case involving the sale of XRP and unregistered securities.
SEC Reverses Staff Accounting Bulletin
In addition to this week’s decision, the SEC has made more crypto-related changes since Donald Trump became the 47th President of the United States. Shortly after taking office on January 20, the SEC withdrew Staff Accounting Bulletin (SAB) No. 121, a rule that required companies to list their cryptocurrency holdings on their balance sheets, creating challenges for financial institutions handling digital assets. The move is seen as a step toward easing the regulatory burden on crypto companies and institutions.
Why This Matters
The SEC’s decision to downsize its crypto enforcement unit and review its policies signals a potential shift toward a more balanced regulatory approach, bringing clarity to the crypto industry and easing some of the burdens previously placed on digital asset companies.