US SEC scales down crypto enforcement unit while task force gears up: report

The U.S. Securities and Exchange Commission is taking steps to scale down its special unit for crypto enforcement actions, The New York Times reported, citing five sources familiar with the matter.

The agency is currently reducing the size of the unit which consists of over 50 lawyers and other staff members. Some lawyers, including one of the unit’s leading members, were relocated to other departments in the SEC, the report said . 

The Block has reached out to the SEC for confirmation and further comments.

While the crypto enforcement action unit is reportedly being downsized, the SEC’s newly established crypto task force is expected to bring the anticipated clarity to crypto regulations. 

Earlier today, the SEC reportedly opened a new website for the crypto task force, inviting input from the industry and the public.

Republican Commissioner Hester Peirce wrote in a statement Tuesday that the task force will work to classify different types of crypto assets and activities, to identify which would fall under the scope of financial securities. 

Clarity on the securities classification of certain cryptocurrencies is something that the crypto sector has long called for but had not sufficiently been addressed by the SEC under former chair Gary Gensler ’s leadership.

Gensler, who spearheaded “regulation by enforcement” on major U.S. crypto players, departed the agency following the reelection of crypto proponent Donald Trump as president.

Trump has selected crypto-friendly commissioner Mark T. Uyeda as the acting chair of the SEC, who made a “slew of appointments” amid top-level restructuring, according to the New York Times report. 

Meanwhile, the U.S. President has nominated former regulator Paul Atkins to lead the commission, who is also known for his long-time support for crypto.