Having served as the first chief of the SEC’s crypto unit from 2017 to 2019, I’m often asked what kind of crypto enforcement we should expect from the new administration. I don’t know for certain, but I believe it will be different yet will not disappear.

The Beginning

The SEC’s crypto enforcement unit emerged in 2017. Initially, it concentrated on fraud and core capital raising events, particularly focusing on unregistered initial coin offerings (ICOs).

The Last Four Years

In recent years, the SEC has turned its attention to secondary markets like trading platforms, where it is less clear how federal laws apply. This has led to an increased focus on regulatory disputes versus fraud cases.

The Future

I don’t believe the crypto industry desires a lack of regulation. They seek a practical framework to ensure compliance while also pressing for fraud prevention. The SEC’s upcoming approach may see a resurgence in fraud investigations while also drafting new regulations to clarify compliance standards, allowing the industry to thrive without compromising investor protection.

Conclusion

Anticipating the next four years suggests SEC enforcement will continue with shifted priorities, balancing investor protection against a framework that facilitates market stability and growth.