Donald Trump’s reelection as President could also see the longstanding SEC chair’s position threatened
Former SEC director William McLucas leveled scathing criticism at Gary Gensler’s aggressive approach to cryptocurrencies at a securities enforcement conference on Wednesday
“The enforcement cases that have been brought are what they are, but they keep bringing them,” McLucas said
“That can’t be the solution because whether you like crypto or you don’t like crypto, it’s not going away,” he added, emphasizing the need for a more balanced approach to regulation.
Gensler’s position already faces a renewed threat, as Donald Trump’s presidential win is expected to bring major changes to the U.S. Securities and Exchange Commission’s (SEC) approach to crypto regulation.
At the Bitcoin 2024 Conference in Nashville last July, Trump pledged to fire current SEC Chair Gary Gensler. The current US President also vowed to appoint crypto-friendly regulators, signaling a likely rollback of the agency’s aggressive enforcement efforts against digital asset firms.
Industry looks forward to constructive regulation
Under Gensler’s leadership, the SEC pursued 46 crypto-related cases in 2023—a 50% increase from the previous year—imposing significant penalties, including a record $4.5 billion fine on Terraform Labs.
The regulator has also cracked down on crypto exchanges and swaps. Most recently, it settled with eToro to remove almost all crypto assets, with customers now only able to trade Bitcoin, Ethereum, and a handful of other major coins.
These aggressive actions have fueled frustration within the industry, with some executives saying the SEC’s approach has created unnecessary regulatory uncertainty for U.S. firms.
Crypto industry leaders are hopeful that a new SEC chair will adopt a more collaborative approach.
Jack Inglis, CEO of the Alternative Investment Management Association (AIMA), believes the incoming administration will provide clearer regulatory guidance.
“We expect that both the Trump administration’s and new Congress’ approach to crypto regulation will be much more constructive,” Inglis said in a statement, noting that the priority should be integrating digital assets into the broader financial system.
Some experts believe that a rollback on the SEC’s regulatory pressure could drive broader crypto adoption, possibly setting the stage for new highs.
Proof of this has come in the form of Bitcoin’s new all-time high, as well as the rise of other meme coins such as Dogecoin, which soared 19% following Trump’s victory.
Legislators could now advance measures to modernize U.S. crypto regulations, potentially enabling the industry to operate more freely within the financial framework.
Gensler may pursue final actions
Despite hopes for regulatory easing, some insiders believe Gensler could push through additional enforcement cases before Trump’s inauguration.
An anonymous crypto executive noted that Uniswap and OpenSea, which have received Wells notices, could still face formal SEC action.
Calls for Gensler to step down are already mounting. “The people voted for this country to take a new direction, and Chairman Gensler should respect that vote by stepping down immediately,” said Chris Iacovella, CEO of the American Securities Association.
If Gensler resigns early, SEC enforcement could slow as the agency would be split 2-2 along party lines, likely pausing actions until a new chair is confirmed.
Hopes rise for softer SEC crypto stance
Many in the crypto industry see Trump’s win as a turning point toward reduced regulatory pressure.
“[Crypto’s] integration into the broader financial framework needs thoughtful policies, not constant battles,” said AIMA’s Inglis, reflecting optimism for a more supportive SEC under the new administration.
This shift could also lead to enhanced institutional interest in crypto, especially as the SEC’s recent approval of options trading for Bitcoin ETFs is expected to attract more traditional investors.
