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"SEC Shifts Gears: Crypto Task Force Aims to Clarify Rules, Ease Enforcement"

Coin WorldWednesday, Feb 5, 2025 1:26 am ET

1min read

The U.S. Securities and Exchange Commission (SEC) has announced a significant shift in its approach to cryptocurrency regulation, scaling back its enforcement unit and reassigning 50 staff members. This move comes following President Trump's executive order to ease digital asset regulations, potentially impacting high-profile cases such as the Ripple lawsuit.

Acting SEC Chairman Mark Uyeda has formed a task force led by Commissioner Hester Peirce, often referred to as "Crypto Mom," to review digital asset strategies and re-evaluate classifications. Meanwhile, White House Crypto Czar David Sacks has announced plans for a national Bitcoin reserve, with 15 states considering Bitcoin adoption and a new stablecoin bill set for Congress.

The SEC's new Crypto Task Force, led by Commissioner Hester Peirce, aims to provide clear rules and end enforcement-heavy tactics. The task force will address long-standing uncertainties in the crypto space, including the classification of cryptocurrencies as securities or commodities, and create a smoother registration process for crypto firms. Additionally, the task force will focus on crypto lending and staking programs, as well as defining the SEC's role in the crypto market.

This change in direction comes after the departure of former SEC Chair Gary Gensler, whose leadership was marked by a strict "regulation by enforcement" strategy. The new task force will focus on creating fair and transparent rules rather than simply punishing companies after the fact.

The SEC is also reviewing applications for new crypto exchange-traded funds (ETFs), following the approval of Bitcoin and Ethereum ETFs in 2024. The agency is considering funds for other cryptocurrencies like XRP, Solana, and Dogecoin, as well as proposals to introduce new features for crypto ETFs, such as staking rewards for investors.

In a separate development, Empower Oversight has filed a lawsuit against the SEC for the release of a long-awaited report on ethical conflicts and selective enforcement within the agency. The report, completed by the SEC Office of Inspector General (SEC OIG) more than a year ago, examines potential conflicts of interest involving former Director of the SEC’s Division of Corporate Finance, William Hinman, and his role in the agency’s decisions on cryptocurrencies.

Empower Oversight, a nonprofit watchdog group, has been pushing for greater transparency from the SEC since August

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