SEC crypto enforcement plunged 30% under Gensler’s final year

The U.S. Securities and Exchange Commission (SEC) saw a 30% decline in crypto-related enforcement actions during the final year of former Chair Gary Gensler’s tenure.

As per a report by Cornerstone Research, the agency initiated only 33 crypto-related actions in its last year under Gensler, down from 47 actions the previous year, which marked its peak enforcement period.

Gensler’s $5B penalties mark aggressive enforcement in 2024

Though the number of actions was down, the money penalties in the crypto sector reached a record $5 billion in 2024, mainly because of the SEC’s $4.5 billion settlement with Terraform Labs. In total, the agency charged 90 defendants in crypto enforcement actions last year, including 33 firms and 57 individuals.

Gensler, Biden’s pick in 2021, stepped down as SEC chairman on Jan. 20,  2025, after Trump’s return to the White House. Under Gensler’s leadership, the SEC took nearly 80% more crypto-related enforcement actions than his predecessor, Jay Clayton, who was SEC chairman from 2017 until 2020.

Cornerstone said over half of the SEC’s enforcement actions in 2024 were in September and October, with only four actions initiated after the US elections in November.

Cornerstone’s analysis found that the most common allegations in crypto-related cases were fraud and unregistered securities, at 73% and 58%, respectively. The report also found rising charges of market manipulation and failure to register as a broker-dealer.

Of the 207 crypto enforcement actions brought by the SEC since 2013, 47% have been related to initial coin offerings and non-fungible tokens.

Mark Uyeda shifts SEC priorities by repealing controversial crypto rule

Under acting chair Mark Uyeda, Trump’s appointee to lead the SEC, the agency has already begun shifting its priorities. On Jan. 23, just days after Gensler’s departure, the SEC repealed Staff Accounting Bulletin 121, a controversial rule that required banks and other financial institutions that hold cryptos to treat them as liabilities on their balance sheets. The new administration has interpreted this as a shift in regulatory priorities.

Commenting on the developments, Lauren Compere, head of stewardship and engagement at Boston Common Asset Management, said:

“While we anticipated that the Trump administration’s appointed SEC chair, interim or permanent, would oversee a fundamental shift in priorities, Uyeda’s past suggestion that companies could go around established SEC rules, which is cause for significant concern.” – Lauren Compere

Uyeda will temporarily head the SEC while Trump’s nominee, Paul Atkins, undergoes the approval process, which is expected to take several months. He has previously been critical of the shareholder filing process, saying that companies should be able to bypass the SEC’s no-action process and set their own standards for shareholder resolutions.

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