First Day of US Government Shutdown: SEC's Operations in Question

On the first day of the US government shutdown, the Securities and Exchange Commission (SEC) initiated the closure of certain operations. Staff members were instructed to secure their work and get ready for what might be an extended operational halt due to financial constraints.

A recent notice from the SEC indicated that the agency will function under a previously established plan that allows only a minimal number of personnel to operate. This plan, created last August, foresees many systems running in a minimized capacity.

“On the first workday of a lapse in appropriations, non-excepted staff will engage in activities to shut down their respective operations, to secure their workstations and work materials, and to prepare for the rapid restart of operations when funding is renewed,” the SEC stated.

Can the SEC handle cryptocurrency affairs during this shutdown?

During this period, the SEC will refrain from participating in ongoing litigation, except in emergency scenarios implicating property threats. This effectively halts any legal actions against cryptocurrency firms until the situation is resolved.

Furthermore, the SEC will be unable to process registration applications, conduct non-emergency rule-making, supervise self-regulatory organizations, or provide assistance to foreign regulatory authorities.

For instance, several cryptocurrency ETF applications linked to Solana are pending approval, and experts had predicted the SEC would greenlight these for trading by mid-October. However, this timeline is now uncertain due to the shutdown.

Source: Kristin Smith

No resolution for the shutdown in sight

As of now, there have been no breakthroughs between the Republican and Democratic parties about a temporary funding solution. Mike Johnson, the Speaker of the House, mentioned that the chamber would reconvene next week but indicated that no alterations to the proposed funding would be regarded by Republicans. Democrats continue to push back, demanding the reversal of various healthcare cuts imposed by a budget bill signed in July.

The SEC’s operational strategy permits staff to return to work the next regularly scheduled day once funding legislation is enacted.