As SEC Chairman’s term comes to an end, what else can he do for the crypto industry?
Despite widespread dissatisfaction from the crypto industry, SEC Chairman Gary Gensler still has the ability to initiate multiple actions before leaving office.
Original title: What Gary Gensler Could Still Do Against Crypto in His Remaining Days as SEC Chair
Original author: Veronica Irwin, unchainedcrypto
Original translation: Shan Ouba, Golden Finance
Despite the dissatisfaction of the crypto industry, SEC Chairman Gary Gensler still has the ability to initiate multiple actions before leaving office, but there are reports that these measures may be quickly revoked.
The crypto market rebounded sharply after Donald Trump won the US presidential election. Investors are full of expectations that the president who calls himself "Friend of Crypto" will lead the country for four years, coupled with Republican control of the Senate and possible control of the House of Representatives, making the crypto industry full of confidence in the next four years. Currently, the biggest political concern in the blockchain community is what measures Gensler will take in the 75 days before Trump is sworn in on January 20.
Trump has promised to remove Gensler from office immediately upon taking office, and experts are divided over whether Gensler will "destroy" the crypto industry or choose to "lay down his arms" during the remainder of his term. But most experts agree that Trump's successor will have the power to stop existing investigations, lawsuits, and even new rulemaking.
"Any enforcement action he initiates can be undone," said Jonathan Padilla, CEO of Web3 marketing tool company Snickerdoodle Labs and an active Democrat. "Any new rules can also be overturned by a new chairman or a new Congress." Padilla said, "Basically, everything can be undone within 100 days."
Although Trump has repeatedly promised to "fire" Gensler on the first day of the new administration because of Gensler's hostility to the crypto industry and his "enforcement-style regulation" approach, Trump may not be able to completely legally remove Gensler from the SEC commission. However, he could demote Gensler to a regular commissioner, with significantly reduced authority. Typically, SEC chairmen appointed by the president voluntarily resign when a new administration takes office, but an SEC spokesperson declined to comment when asked by Fox News reporter Eleanor Treat whether Gensler planned to leave before Trump takes office.
The SEC did not immediately respond to inquiries for this article.
Gensler's Possible Actions
Trump could appoint a new chair with a completely different stance, which could prompt Gensler to impose tougher regulations on the crypto industry in his final days. "Crypto policy will change immediately and significantly when new leadership takes over federal agencies," warned Jack Chervinsky, chief legal officer at Variant Fund. "The current administration will likely be busy completing rulemaking and filing enforcement actions before then," he said on the X platform.
But others, like Padilla, speculate that Gensler may quietly serve out the rest of his term. Sources with knowledge of the SEC say Gensler’s staff may slow down any actions he wishes to take, weakening his ultimate influence.
If Gensler decides to take drastic action, he has several options. For example, he could unilaterally launch new investigations into companies believed to have violated securities laws, perhaps through the issuance of new Wells notices or subpoenas. If Gensler can get the support of other Democratic-appointed commissioners, he could also file lawsuits against some of the companies that have already received Wells notices, such as crypto gaming company Immutable, NFT platform OpenSea, and stock and crypto trading platform Robinhood.
However, Gensler does not have enough time to resolve any new legal actions or complete new rulemaking before January 20, as both processes typically take months. Once a new SEC chair takes office, they will have the power to put such lawsuits on hold or abandon them.
Gensler also has the power to further rulemaking that has already been proposed and completed the public comment process. For example, he could finalize updates to the SEC's definition of an "exchange" and expand registration requirements for market makers, including some crypto businesses.
However, crypto industry supporters may also sue these new rules. At the same time, Congress can use the Congressional Review Act to overturn these rules as long as Congress acts within 60 days of the start of the session. Therefore, if Gensler passes new rules before January 20, Congressional time will be occupied in the early days of the next administration.
For rules that are not overturned by Congress within 60 legislative days, the new SEC chairman can also phase out. However, this will be a longer process because the SEC will need to follow the public comment process of the Administrative Procedure Act to make new rules to repeal the rules approved by Gensler.
While uncommon, historical precedent does exist for the SEC to take action during the election and inauguration of a new president. For example, the Trump administration filed a lawsuit against Ripple on December 22, 2020, near the end of its term, even though the SEC was less politicized at the time and the move was likely unrelated to Biden's incoming SEC chairman's different attitude.
Sources said it is rare for SEC enforcement actions to be so strongly influenced by political factors, and speculation about how Gensler will handle crypto affairs in his final days is unprecedented. "This reflects Gary's anti-crypto attitude during his term," explained the source, who has experience in dealing with SEC lawsuits. "The SEC's enforcement strategy has never been so constrained by a presidential election as it is today."
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
MARA Holdings completes $1 billion debt offering to acquire more Bitcoin
MicroStrategy completes $3 billion notes offering to buy more Bitcoin
Notice on Trading and Pre Market Delivery time Update for MAJOR/USDT
As per requested by the project, Bitget will change the trading time of MAJOR/USDT to 28 November 2024, 08:00 (UTC),and the pre market delivery time to 28 November 2024, 20:00 (UTC). Thank you for your understanding on this matter. Disclaimer Cryptocurrencies are subjected to high market risk and v
SUI’s Blockchain Has Been Down for an Hour