SEC launches crypto task force, saying it can ‘do better’

Editorial

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For years, under the leadership of Gary Gensler, the SEC has been at loggerheads with the crypto industry, embroiled in legal fights with a host of big name players, often over whether assets listed on their platforms are securities or not.

But, with Gensler out and Trump embracing crypto – and even launching his own meme coin – the regulator is reassessing its approach.

In a statement, the SEC says that it has, to date, relied primarily on enforcement actions to regulate crypto retroactively and reactively, “often adopting novel and untested legal interpretations along the way”.

It continues: “Clarity regarding who must register, and practical solutions for those seeking to register, have been elusive. The result has been confusion about what is legal, which creates an environment hostile to innovation and conducive to fraud. The SEC can do better.”

The task force will work towards clear regulatory lines, the provision of realistic paths to registration, sensible disclosure frameworks, and deploying enforcement resources “judiciously”.

All change at the FDIC

The SEC is not the only regulator looking to shake things up in the Trump era. The Federal Deposit Insurance Corporation has set its sights on a “more open-minded approach to innovation and technology adoption”.

This includes “a more transparent approach to fintech partnerships and to digital assets and tokenization,” as well as “engagement to address growing technology costs for community banks”.

Late last year, the FDIC – still under the Biden administration – began looking at plans to protect customers from fintech failures in the wake of the collapse of Synapse, which resulted in customers of the BaaS platform’s clients unable to access their money. The FDIC was prepping new regulations on third-party reconcilement requirements.

Silk Road founder pardoned

Trump has this week signed a full and unconditional pardon for Ross Ulbricht, who operated The Silk Road, the dark web marketplace where shoppers bought and sold illegal goods with bitcoin.

Ulbricht was sentenced to life in prison in 2015 after being convicted on narcotics and money-laundering conspiracy charges. He has since become a rallying cry for libertarians arguing that his conviction was a case of government overreach.

“The scum that worked to convict him were some of the same lunatics who were involved in the modern day weaponisation of government against me,” Trump wrote on social media after pardoning Ulbricht.