Trump’s SEC Reshapes Crypto Regulation, Scaling Back Enforcement

The U.S. Securities and Exchange Commission (SEC) is cutting back its crypto enforcement unit, marking a significant shift in regulatory policy under President Donald Trump, according to the New York Times.

The SEC's crypto unit, which had over 50 lawyers and staff, is being downsized, with some members reassigned to other departments. Sources described the change as a setback for crypto oversight, with some calling it an "unfair demotion." The move follows Trump’s recent executive order to reduce regulatory overreach in the digital asset sector.

Trump has consistently advocated for pro-crypto policies. Shortly after taking office, he appointed Mark Uyeda as acting SEC Chair. Uyeda quickly launched a team to reassess the agency’s enforcement-driven approach to crypto regulation, led by crypto-friendly SEC commissioner Hester Peirce.

The SEC still has ongoing cases against major crypto firms, including Coinbase (NASDAQ: COIN), though investors anticipate regulatory easing under the new administration. Trump’s nominee for SEC Chair, Paul Atkins, is known for his supportive stance on lighter crypto regulations.

Under former SEC Chair Gary Gensler, the agency cracked down on crypto following a wave of industry scandals in 2022. However, Trump's approach signals a shift towards a more industry-friendly regulatory environment.

Bitcoin (BTC), the world’s largest cryptocurrency, surged to record highs ahead of Trump's inauguration. However, BTC was down 4% at $97,564.7 by 18:31 ET (23:31 GMT).

With the SEC’s enforcement stance softening, the crypto industry is bracing for potential regulatory reforms that could reshape the market’s future.