Key Points:

  • Gensler’s Departure: Gary Gensler, the SEC Chair known for his stringent stance on crypto regulation, is likely to step down with Trump’s return to office. Trump has expressed intent to remove Gensler, whose leadership has led to aggressive enforcement actions against prominent crypto firms, including Coinbase.

  • Shift in SEC Leadership and Policy: A Trump-appointed SEC chair is expected to steer away from heavy-handed enforcement, focusing instead on establishing clearer, more crypto-friendly regulations. This shift could offer relief to crypto companies that have faced fines and legal challenges under current policies.

  • Crypto-Supportive Legislation on the Horizon: With Republicans gaining control of the Senate, bipartisan crypto-friendly laws aimed at regulating digital assets more flexibly have a greater chance of passing. This legislative support aligns with the industry’s call for a more accommodating approach.

  • Impact on Key Crypto Cases: The upcoming change in administration improves the chances for firms like Coinbase in ongoing legal battles with the SEC. Experts suggest a more favorable outcome for crypto firms, potentially including a reevaluation of the Howey test, a longstanding legal standard for securities.

  • Industry Anticipates Reduced Enforcement Actions: Many believe the SEC’s focus on enforcing registration and compliance will decrease. Enforcement may slow, especially against firms like Uniswap and OpenSea, as agency staff anticipate the regulatory shift under Trump’s administration.

  • Push for Crypto in Financial Frameworks: Industry leaders expect the new administration to advocate for the integration of crypto within the broader financial system, acknowledging its distinct characteristics from traditional assets.

  • Growing Public Interest and Complaints: Crypto-related complaints to the SEC surged in 2024, highlighting the need for clearer policies. The SEC received nearly 6,000 complaints about digital assets, emphasizing the importance of establishing a balanced regulatory approach.

  • Political and Industry Support for Change: Key financial industry figures and Trump supporters are urging Gensler to resign early, calling for a new SEC direction that aligns with the election’s outcome.