News of Gary Gensler's resignation is currently shaking the cryptocurrency world. The SEC Chairman has confirmed that he will resign from the U.S. Securities and Exchange Commission (SEC) just before Donald Trump is sworn in. This comes after a long period.
Reflecting on his controversial tenure, Stuart Alderoty, Chief Legal Officer (CLO) of Ripple Labs, outlined six tasks that the next Chairman must address upon taking office.
Stuart Alderoty breaks the silence in the search for SEC Chairman
In a viral announcement, Gary Gensler stated that he would leave the commission on January 26. Notably, Gensler's term as SEC Chairman is set to expire in 2026.
Prior to this update, several key stakeholders in the cryptocurrency space had even named their preferred candidates for this position.
In a post on X, Ripple's CLO dismissed his opinion on the ongoing debate about the SEC Chairman. He described the recent endorsements for the next SEC Chairman as 'unsolicited advice.' Alderoty stated that he trusts the transition team will choose the right candidate to take over from Gensler.
The cryptocurrency community has continually criticized Gensler's approach to cryptocurrency regulation. Gensler stated that his approach is based on treating digital assets like traditional securities.
However, some high-level enforcement actions have taken place since he adopted this approach. U.S. Congressman Ritchie Torres recently criticized Gensler's broad application of securities laws to digital assets, arguing that it stifles the industry's growth.
Additionally, a former SEC official, John Reed Stark, has predicted that the enforcement of cryptocurrency laws will ease under the new leadership of the SEC.
6 considerations and significant implications
In his post, Alderoty highlighted six key considerations regarding the tasks that the next SEC Chairman needs to address.
Firstly, he mentioned that the new Chairman must dismiss all fraudulent cryptocurrency cases on their first day in office. Gary Gensler's tough stance has targeted cryptocurrency companies like Coinbase, Kraken, and ConsenSys.
Secondly, Alderoty stated that the next Chairman should receive a commitment from Commissioners Peirce and Uyeda that they will continue and cooperate with him.
Ripple's CLO views the support of the Commissioners as a major driving force for establishing clear cryptocurrency policies. Additionally, Alderoty noted that the next Chairman should collaborate with all financial regulatory agencies and Congress on clear and simple rules for cryptocurrency.
However, he stated that the SEC should not assume that those rules grant the SEC primary jurisdiction over anything. The fourth task is to abandon the Hinman speech from 2018 and the 'Framework for Investment Contract Analysis of Digital Assets' from 2019.
Moreover, he noted that the next Chairman must create transparency regarding the FOIA process.
The new chairman's final task will be to ensure accountability and restore public trust. He noted that he could do this by addressing past issues within the SEC and encouraging the Office of the Inspector General.
Who is the most suitable person for the SEC Chairman position?
Some cryptocurrency stakeholders have analyzed potential candidates to replace Gary Gensler as Chairman of the U.S. SEC. For instance, cryptocurrency lawyer John E. Deaton has confirmed Brad Bondi, Global Co-Chair of White Collar Investigations and Defense at Paul Hastings.
Other prominent candidates for the role include former SEC Commissioner Paul Atkins, Robinhood CLO Dan Gallagher, and Bob Stebbins. These candidates have good management experience and may be more lenient on cryptocurrency enforcement.
While everyone is free to nominate a replacement for the head of the SEC, the final decision still rests with the incoming administration.
