U.S. Securities and Exchange Commission (SEC) official Mark Uyeda has called for a shift in the agency’s handling of cryptocurrency regulations.
The sentiment from the commissioner, a member of the Republican party, aligns with President-elect Donald Trump’s campaign promise to halt the Biden administration’s aggressive stance towards the digital asset industry.
Pause in SEC’s Enforcement Approach
In a recent interview with Fox Business, Uyeda reiterated the need for the SEC to stop enforcement actions against non-fraud cases lodged against various crypto firms.
“The Commission’s war on crypto must end, including crypto enforcement actions solely based on a failure to register with no allegation of fraud or harm.”
In the last three years, the regulatory agency launched more than one hundred enforcement actions against crypto-related companies. The actions targeted a range of misconducts, including serious ones like fraud and money laundering, with one such case being the prosecution of former FTX CEO Sam Bankman-Fried.
However, others involved lesser infractions, including failure to comply with registration requirements. Lawsuits like those the SEC brought against Coinbase, Ripple, Kraken, and Consensys fall in this category.
Such claims were reportedly filed because SEC Chair Gary Gensler interpreted that most crypto tokens, apart from Bitcoin (BTC) and Ethereum (ETH), qualify as securities under the agency’s jurisdiction.
Experts, including lawyer Jeremy Hogan and former SEC official John Reed Stark, have suggested that if Gensler steps down before January 20, 2025, the day of Trump’s inauguration, a newly appointed head could dispose of all non-fraud crypto cases. This could mean settling those with existing rulings and dismissing the ones still in litigation.
Speculation on Next SEC Chair
The Fox Business report claimed that Uyeda is among those being considered by the incoming Trump administration to take over from Gensler should he vacate his position. According to Reuters, others in contention for the position include Robinhood’s chief legal and compliance officer, Dan Gallagher, and Patomak Global CEO Paul Atkins.
The current chair’s approach to crypto regulation has made him a hugely unpopular figure within the industry, with Ripple CEO Brad Garlinghouse describing his term as a “reign of terror.”
Further, legal experts and members of Congress have also voiced their concerns, arguing the financial watchdog should put forward clearer and more consistent regulations. The criticism has also come from within the SEC, with Uyeda and fellow Commissioner Hester Peirce advocating for a more transparent and balanced approach towards policing crypto.
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