SEC Cuts Crypto Crackdowns, Revises Token Issuance and Custody Rules

• SEC has reassigned over 50 staff from its crypto unit, signaling a change in regulatory strategy.
• Led by Hester Peirce, the Crypto task force aims to clarify securities laws and create balanced policies for digital assets.
• Following Trump’s re-election, the SEC is moving from enforcement-heavy tactics to structured guidance under new leadership.

The U.S. Securities and Exchange Commission (SEC) has reduced its crypto enforcement division, reassigning more than 50 lawyers and staff to other departments. The shift follows President Donald Trump’s commitment to easing regulations and fostering digital asset growth. Some reports have described certain reassignments as unfair demotions, signaling internal challenges during the restructuring process.

Creation of a Crypto Task Force

Acting SEC Chair Mark T. Uyeda recognized for his supportive stance on digital assets, has led the restructuring. A development under his leadership is the formation of a dedicated crypto task force, now led by Commissioner Hester Peirce. The task force is tasked with describing the application of securities laws to crypto assets and developing policies that encourage invention while maintaining investor protection.

The ambition also seeks to establish more precise guidelines on which digital assets qualify as securities and provide comfort measures for token issuers. Additionally, the task force will review registered token offerings and explore compliant custody solutions for investment advisers handling digital assets.

Policy Shift Under New Leadership 

The SEC’s regulatory shift marks a departure from the enforcement-heavy approach under former Chair Gary Gensler, whose tenure saw over 100 crypto-related enforcement actions. These included major cases such as Coinbase’s alleged securities law violations. Gensler stepped down following Trump’s re-election, paving the way for a policy transition.

Paul Atkins has been nominated to succeed Gensler. Known for advocating a lighter regulatory approach, Atkins is expected to continue the SEC’s shift toward structured guidance rather than enforcement. Uyeda’s leadership has already signaled a strategic realignment, with Peirce describing the restructuring as a necessary correction.

The SEC has launched a website for the crypto task force to gather public input from industry stakeholders and investors. The platform facilitates idea submissions and discussions on regulatory policies. Peirce has acknowledged the complexity of the process but expressed confidence in developing policies that balance industry growth with oversight.