The U.S. Securities and Exchange Commission (SEC) is downsizing its Crypto Assets and Cyber Unit, reflecting regulatory approach changes under Mark Uyeda’s leadership.
Changes in the SEC Structure
The Securities and Exchange Commission (SEC) has decided to downsize its Crypto Assets and Cyber Unit as it reviews its regulatory strategy. Previously, under Gary Gensler, the unit expanded significantly, actively pursuing crypto firms. However, with these changes, lawyers are being reassigned to other divisions, and several key members are leaving the enforcement unit entirely. This move aligns with the Trump administration’s broader efforts to ease cryptocurrency regulations. New acting SEC Chairman Mark Uyeda has initiated a task force to review digital asset regulation.
Push for Crypto-Friendly Reforms
SEC Commissioner Hester Peirce, known for her support of cryptocurrencies, welcomes the SEC’s new direction, criticizing the previous approach as "careening down the road while incessantly slamming on the brakes." Her task force will focus on:
- Clarifying digital assets as securities. - Offering retroactive relief for certain token offerings. - Simplifying the registration process for crypto financial products. - Increasing regulatory clarity for staking, lending, and custodial services.
Impact on Pending Cases and the Crypto Industry
The SEC's restructuring raises questions about the fate of pending cases, including its lawsuit against Coinbase for operating as an unregistered exchange. The crypto industry has long criticized the SEC for regulatory uncertainty, and these changes may indicate a more measured approach going forward. According to Cornerstone Research, the SEC filed 33 lawsuits against 90 crypto-related defendants in 2024. Downsizing may slow enforcement, indicating a shift from punitive actions to clearer regulations.
The downsizing and regulatory strategy changes at the SEC may impact the cryptocurrency sector, potentially leading to clearer, more crypto-friendly conditions, supported by the Trump administration’s policies.
