Gary Gensler, the chairman of the U.S. Securities and Exchange Commission (SEC), has faced fierce resistance from Wall Street and the cryptocurrency industry due to his ambitious agenda, and he now plans to resign on January 20 of next year (the day Trump is inaugurated as president).
Officially, Gensler's five-year term at the SEC does not end until 2026, but it has become common practice for SEC chairs, especially those who are unpopular, to change with a presidential transition.
In a statement on Thursday, Gensler said, "The SEC is a remarkable agency. The staff and the commission are mission-driven, focusing on protecting investors, facilitating capital formation, and ensuring that markets serve investors and issuers."
His departure will leave the SEC in the hands of an acting chair, expected to be Mark Uyeda or Hester Peirce, both Republican commissioners.
Self-described as a "market person," Gensler was appointed by Biden in 2021 and has pursued an aggressive agenda focusing on climate risk disclosure, stock trading reform, and cracking down on cryptocurrency criminals. Some of his regulations will leave a lasting mark on the financial sector, while others have been hindered in conservative courts.
The SEC chair nominee soon to be chosen by the Trump administration may attempt to further roll back Gensler's signature rules and adopt a more crypto-friendly enforcement approach.
Gensler's policy achievements include accelerating the settlement time for U.S. stock trades and a new rule that will increase the daily clearing volume of U.S. Treasury market transactions by trillions of dollars. Company insiders also face stricter disclosure and stock sale rules.
However, some key projects in Gensler's agenda are facing legal challenges. In March, the SEC announced a comprehensive rule requiring companies to disclose detailed information about their greenhouse gas emissions and how climate change would impact their bottom line. After multiple lawsuits, the agency froze these rules in April.
A federal judge on Thursday rejected the SEC's new rule requiring some Wall Street firms to register as government bond market dealers. Hedge funds had sued to block the rule since March, arguing it was overly broad and could harm the market. The Healthy Markets Association, an industry organization that includes pension funds, said its head Tyler Gellasch, "From the scope of issues he wanted to focus on, his term should be considered ambitious. But this agenda was first met with the shock of litigation."
The SEC under Trump may loosen enforcement against brokers, banks, and hedge funds using third-party messaging apps for communication. Policies for the digital asset industry could undergo significant changes.
Gensler has relentlessly pursued cryptocurrency fraudsters and companies like Coinbase Global Inc. and proprietary trading giant DRW Holdings for not registering with the agency. The industry has strongly opposed him, claiming he has not provided a real way for this emerging asset class to fit into a structure with decades of history.
Gensler is often criticized by the industry for stifling the market rather than clearly outlining how to comply with the rules.
"My mom always told me, if you don't have anything nice to say, don't say anything at all. So I won't say anything," Coinbase Chief Legal Officer Paul Grewal wrote on X after Gensler announced his impending departure.
Trump supported cryptocurrency during his campaign, and earlier this year he told supporters that he would fire Gensler on his "first day" in office.
According to reports earlier this month, Dan Gallagher, legal chief at Robinhood Markets Inc., former SEC commissioner Paul Atkins, and Robert Stebbins, a partner at Willkie Farr & Gallagher, are considered potential picks for SEC chairman by Trump.
According to Charles Gasparino of Fox Business, Paul Atkins, who is very supportive of cryptocurrency, is expected to succeed Gensler. On the day Gensler announced his resignation, Bitcoin hit a record high, nearing $100,000. On Thursday, Bitcoin briefly climbed to a record $99,000 in U.S. trading. Since Trump's election victory on November 5, the entire cryptocurrency market has risen by about $1 trillion.
Article forwarded from: Jin Shi Data
