The newly appointed crypto and AI czar, David Sacks, has criticized the United States Securities and Exchange Commission (SEC) for its strict rules on crypto. He has also called for clear guidelines involving digital assets, a step towards regulatory clarity.
Regulation Suffers Backlash
Following Trump’s election, the crypto community hopes for a better regulatory environment. Sacks, a former tech executive, noted that many industry leaders are asking the government for clear rules.
The crypto community has criticized former SEC chair Gary Gensler for failing to provide clear guidelines, which creates uncertainty for crypto companies. Industry leaders, including Ripple CEO Brad Garlinghouse, have expressed dissatisfaction with what they see as unfair enforcement and the absence of clear guidance from the SEC on operating in the crypto space.
Gensler has taken a strong approach to pursuing legal actions against crypto companies for alleged violations of federal securities laws. A significant issue is the SEC’s view that many cryptocurrencies, especially Ethereum (ETH) and Ripple (XRP), should be classified as securities.
The ongoing case with Coinbase is a key test of Gensler’s claim that most digital assets are securities contracts, a view that Coinbase and other industry members strongly dispute. This classification requires them to follow strict rules for traditional financial products, which many in the crypto industry argue do not fit their unique nature.
A Shift in Regulatory Landscape
President Trump appointed Paul Atkins, a lawyer connected to the crypto industry, as the new SEC chair in a related development. Atkins is known for encouraging innovation and plans to reduce a unit with over 50 staff members focused on enforcing crypto regulations, favoring self-regulation instead.
This change in leadership and Sacks’ role may lead to a more cooperative approach to regulation, focusing on more explicit guidelines for the crypto industry. This action is one of the first substantial steps taken by Trump’s administration to ease restrictions on crypto and digital assets. One of Trump’s first executive orders aimed to support the growth of crypto and prevent excessive regulation of digital assets.
Meanwhile, the new SEC administration is shaking things up in the crypto world, sparking a frenzy of ETF applications. Asset managers eagerly submit proposals for ETFs focused on Dogecoin, Solana (SOL), and XRP. The surge in ETF applications reflects the crypto industry’s optimism about the new SEC administration’s stance on digital assets.
