SEC’s Crypto Crackdown Falters as Former Official Declares It Over

John Reed Stark, former head of the SEC’s Office of Internet Enforcement, believes the agency's crackdown on crypto has failed. Stark, a longtime critic of the sector, pointed to recent legal shifts involving Coinbase and Binance as signs of the SEC stepping back.

He noted that the SEC’s Crypto Task Force’s involvement in the Coinbase case led to delays in the agency’s response, interpreting it as an implicit concession of defeat. Stark commented, “Stick a fork in the SEC’s case against Coinbase, it’s done.” He also highlighted the SEC’s agreement to pause its lawsuit against Binance for two months, reinforcing the notion of a broader retreat.

Adding to this, Stark revealed an internal SEC reshuffling, where a key crypto trial attorney was abruptly reassigned to a less significant role. He suggested this move signals a leadership shift away from aggressive crypto enforcement.

The former SEC official predicted that the agency would halt all crypto-related investigations and litigation, either dropping cases or settling them under terms favorable to defendants. He specifically suggested that the SEC’s appeal in the Ripple lawsuit could be withdrawn entirely.

Despite prior court rulings categorizing digital assets as securities, Stark argued that these decisions are now moot. He concluded that the SEC’s ability to enforce crypto regulations is effectively over, regardless of how the agency frames its actions.