Regulation
New SEC Leadership Soon? Here’s How Ripple and Other Lawsuits Will Be Affected
Former SEC attorney Marc Fagel has shed light on how a shift to pro-crypto leadership at the SEC could impact ongoing cryptocurrency lawsuits, including the high-profile Ripple case. While a change in administration may not impact ongoing cases, it could lead to significant changes in future cryptocurrency regulations. With speculation of a possible Trump victory, many in the cryptocurrency community are hoping for the end of Gary Gensler’s leadership.
Here’s what you should know.
What about lawsuits?
There are concerns that a new SEC chairman could impact ongoing cryptocurrency cases.
Jungle Inc., a well-known cryptocurrency expert and influencer, asked Marc Fagel about the SEC’s enforcement actions under different political administrations. Fagel noted that during Chairman Clayton’s tenure, the SEC rarely focused on cryptocurrencies, except for obvious violations like ICOs. Under Chairman Gensler, however, enforcement increased due to high-profile fraud cases involving entities like FTX and Celsius. Jungle Inc. wonders whether a pro-cryptocurrency administration might change this approach or whether the SEC will continue its current enforcement until Congress passes new legislation.
Will future policies impact Ripple?
Fagel assured that new SEC leadership is unlikely to change the course of ongoing cases like Ripple. Typically, new leadership does not interfere with ongoing enforcement actions. However, he noted that future policies could impact the resolution or appeals of such cases. If a pro-crypto administration takes over, the Ripple case could be resolved more easily and the SEC could avoid appeals if the ruling favors Ripple.
New leadership, new rules!
Fagel noted that enforcement actions are typically apolitical, meaning they target violations regardless of the political climate. However, new leadership could lead to a more lenient approach to cryptocurrency regulation. If a crypto-friendly administration comes to power, it could shift the focus to more relaxed policies, which could impact how lawsuits involving major companies like Binance, Coinbase, and Consensys are handled. However, any proven misconduct would still prompt regulatory action.
A lenient approach: good or bad?
Even if a new administration takes a less aggressive stance, Fagel warned that it could backfire if another major scandal occurs. Such incidents could force the SEC to ramp up enforcement again. Fagel noted that significant fraud cases have driven the current climate of scrutiny, suggesting that any leniency could be short-lived if similar problems arise.
While the SEC’s new leadership may impact future cryptocurrency regulations, the primary enforcement efforts will remain focused on legal violations and market misconduct. Ripple vs. SEC and other major cryptocurrency lawsuits will continue under SEC oversight regardless of policy changes.
The cryptocurrency industry is at a crossroads. Will a new SEC chairman be a friend or foe? Join the conversation.