With a Republican Senate majority and Donald Trump back in the White House, crypto firms are now advocating for changes at the SEC. Following Trump’s reelection and a more pro-crypto administration, the industry is pushing for a “new perspective” within federal agencies.
Ripple Seeks Policy Changes, Aims for a Rational Approach from the SEC
Ripple, a leading crypto company currently in a legal battle with U.S. regulators, hopes the new White House administration will shift digital asset policies out of the courts and towards regulatory agencies. Stuart Alderoty, Ripple’s Chief Legal Officer, expressed optimism, stating, “The SEC is a bureaucracy, but policy is driven by people. If we can change some of the leadership at the SEC, we might see a more reasonable approach to their enforcement actions.”
Coinbase Joins the Call to End Legal Battles with the SEC
Coinbase’s Chief Legal Officer, Paul Grewal, echoed similar sentiments after Trump’s victory on November 6. He urged regulators to “stop suing crypto” in a post on X (formerly Twitter). Notably, Coinbase and Ripple were among the largest donors supporting pro-crypto candidates in the recent elections.
Trump’s Promise to Reform the SEC Resonates with the Crypto Community
Crypto firms' calls for SEC reforms align with Trump’s campaign promises to crypto supporters. He pledged to remove SEC Chair Gary Gensler on his first day in office. Under Gensler, the SEC has taken several enforcement actions against crypto firms, particularly focusing on classifying digital assets as securities.
Since 2020, Ripple has been in a legal dispute with the SEC, which questioned the status of its native token, XRP. Ripple CEO Brad Garlinghouse revealed in May 2023 that the company expects to spend up to $200 million defending itself. Alderoty emphasized, “The SEC has wasted a lot of resources pursuing enforcement based on their theory that certain crypto assets are securities. This is a policy matter, not something to be settled in courts.”
Trump Could Change the Leadership at the SEC, But It Requires Senate Approval
As President-elect, Trump will have the authority to replace the SEC Chair, although doing so requires cause and Senate approval for a permanent replacement. Gensler’s term is set to end in 2026, but there are speculations that Hester Peirce, a crypto-friendly SEC Commissioner known as “Crypto Mom,” could be a potential successor due to her supportive stance on digital assets.
The Future of SEC Leadership Remains Uncertain
While the future leadership of the SEC is still up in the air, Gensler hinted at possible changes ahead. In an interview with The Wall Street Journal, he remarked, “Presidents traditionally get to choose who leads the SEC, and that’s part of democracy.”