According to a recent report by Cornerstone Research, significant reductions in cryptocurrency enforcement actions occurred during Gary Gensler’s final year as Chairman of the U.S. Securities and Exchange Commission (SEC). The report reveals a 30% decrease in enforcement actions related to cryptocurrencies in 2024 as compared to the previous year. Notably, 2023 witnessed the highest number of such actions, while 2024 saw this number drop to 33.
Decline in SEC’s Crypto Enforcement Actions
The report titled “SEC Cryptocurrency Enforcement” highlights that although the number of enforcement actions declined, the financial penalties imposed on crypto firms reached an all-time high. In 2024, these penalties amounted to $4.98 billion, primarily driven by a single billion-dollar settlement.
According to Cornerstone Research, “In 2024, the SEC secured a total of $4.55 billion in financial settlements against Terraform Labs PTE Ltd. and others. Of this amount, $4.05 billion was attributed to returned revenues and pre-judgment interest.”
Appointment of New SEC Chairman
This week, President Trump appointed Mark T. Uyeda as the Acting Chairman of the SEC. This appointment could significantly influence the SEC’s future regulatory policies.
The report indicates that the enforcement actions taken in the last quarter of 2024 comprised 50% of the annual total. This suggests an intensification of the SEC’s regulatory activities concerning cryptocurrency markets as the year concluded.
However, the increase in total financial penalties despite the decrease in enforcement actions indicates that large-scale cases play a crucial role in the SEC’s strategy. This trend cannot be interpreted as a reduction in regulation, as the new SEC leadership may opt for clear regulatory guidelines rather than punitive actions.
Finally, these regulatory shifts by the SEC in cryptocurrency markets could impact market dynamics and investor confidence. Investors may closely monitor such developments to adjust their strategies accordingly.