Many legal actions taken by the U.S. Securities and Exchange Commission (SEC) against cryptocurrency companies may quietly fade away following the resignation of SEC Chair Gary Gensler in January, according to Pantera's Chief Legal Officer Katrina Paglia.
Legal Disputes May End with Settlements
Speaking at the North American Blockchain Summit in Dallas on November 21, Paglia suggested that most cases are likely to end with settlements. “I think we’ll see a few settlements where the defendants agree to pay something and use language like ‘neither admit nor deny,’” she explained.
She added that while the SEC could theoretically withdraw its claims, this is unlikely: “It has gone too far.” Instead, she believes the regulator will pursue compromises to recover time and resources spent on these cases.
Gensler's Resignation and Its Impact
Gary Gensler announced his resignation as SEC Chair, effective January 20. Paglia believes this could lead to the resolution of several ongoing cases. She also suggested that some Wells notices — formal warnings of potential legal action from the SEC — could be dropped.
“We’re hopeful we’ll start seeing no-action letters from the SEC,” she said. No-action letters indicate the agency does not intend to take legal action against an entity for its planned activities.
Possible Transition to Hester Peirce's Leadership
There is speculation that SEC Commissioner Hester Peirce could take over cryptocurrency-related matters within the agency until a permanent chair is appointed. “We might see her recommend some no-action letters,” Paglia added.
She noted that these changes could happen soon, potentially easing tensions early next year: “We’re looking forward to a cooler January or February for many of the lawsuits we see today.”
History of SEC's Legal Actions Against Crypto Companies
Under Gensler’s leadership, the SEC initiated legal actions against several major cryptocurrency companies, including Ripple, Coinbase, Binance, Kraken, Uniswap, OpenSea, Consensys, Crypto.com, and Robinhood. These efforts were part of a broader strategy to regulate the cryptocurrency sector, though they faced criticism from industry participants.
Changes in SEC leadership may signal a shift in the regulatory approach to cryptocurrencies in the United States, potentially reducing legal pressure on the industry.
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