The United States Securities and Exchange Commission’s (SEC) aggressive legal campaign against crypto companies could see a dramatic shift with the upcoming departure of its chair, Gary Gensler, in January. According to Pantera’s Chief Legal Officer, Katrina Paglia, many lawsuits targeting cryptocurrency firms may quietly fade as the regulator recalibrates its focus under new leadership.
Since Gensler’s tenure began, the SEC has pursued legal actions against numerous high-profile crypto entities, including Binance, Coinbase, Ripple, and Kraken. These actions often centered on allegations of unregistered securities offerings, causing widespread uncertainty across the industry. However, with Gensler stepping down, Paglia suggested that settlements are more likely than prolonged legal battles. Defendants may pay fines or other penalties in agreements that allow both sides to move forward without formally admitting wrongdoing.
Potential Resolution Through Settlements
Paglia highlighted the possibility of the SEC opting for quieter resolutions, such as filing motions to dismiss or withdrawing certain claims. Although a full-scale dismissal of cases is unlikely, settlements could include language that allows defendants to sidestep liability while permitting the SEC to claim some degree of regulatory oversight.
Moreover, Wells Notices—preliminary warnings of enforcement action—might also be quietly shelved, reducing the pressure on crypto firms under investigation. This shift would enable the SEC to redirect resources to other priorities, fostering a more cooperative environment between the agency and the crypto sector.
An intriguing development could come from SEC Commissioner Hester Peirce, known for her more crypto-friendly stance. Rumors suggest she may temporarily oversee the agency’s cryptocurrency matters, potentially recommending the issuance of “no-action letters.”
These letters would signal the regulator’s intent to abstain from legal action against certain crypto firms, offering a reprieve from regulatory uncertainty.
Gensler Departure Leads to New Era for Crypto Regulation?
The SEC’s legal actions under Gensler, widely perceived as a “war on crypto,” have caused major disruption in the crypto space. As the SEC transitions to new leadership, the industry may witness a reduction in litigation and a shift toward constructive dialogue.
With rumors of Peirce’s increased role and the prospect of no-action letters, January and February could mark the start of a less combative era for crypto regulation in the U.S.
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