What crypto investors can expect from a pro-crypto SEC

As the Trump transition team considers multiple candidates for the SEC chief post following Gary Gensler’s announced resignation, crypto investors and policy advocates would be wise to consider what a pro-crypto SEC could mean for the sector. Particularly with Paul Atkins, a former commissioner between 2002 and 2008, and Brian Brooks (former acting Comptroller of the Currency) as well as former SEC general counsel Robert Stebbins emerging as leading candidates, the prospect of a more crypto-friendly SEC is becoming a real possibility.

Additionally, former SEC Chairman Jay Claton has publicly expressed his optimism about favorable crypto industry regulations under the new Trump administration, including the likelihood of crypto legislation with the removal of executive and administrative barriers. Even if the optimism and hopes of a strongly crypto-friendly SEC do not materialize, a weakening of the aggressive regulation-through-enforcement approach under outgoing Chairman Gary Gensler would provide a tailwind for crypto. Aside from the positive, albeit early, discussions about establishing strategic Bitcoin reserves at the state and/or federal level (which would be outside the purview of the SEC), there are several points that investors and policy advocates are keeping an eye on going forward should.

Improved tokenization options

One of the most damaging effects of the SEC’s antagonistic regulatory approach is that crypto entrepreneurs and institutions face obstacles in starting and growing crypto-native companies. Despite individual examples such as Prometheum that have received exemptions from the SEC, the market landscape for organizations seeking to offer ostensibly traditional products and services is contradictory at best.

Regardless of which person leads the SEC under the second Trump administration, the reality is that the landscape and approach to crypto products and services will be more accessible than under Chairman Gensler. A cautionary note that should be factored into any optimistic expectations of a crypto-friendly SEC is that the policies issued may not work exactly as crypto investors or advocates expect. Particularly as discussion of a Bitcoin reserve continues to dominate crypto discourse at the media level, investors should be cautious in setting expectations of any sweeping administrative action.

Address regulatory concerns

One of the biggest advantages and benefits of a pro-crypto SEC is that the regulatory outlook and approaches would be less contrasting compared to what is in place under the current SEC Chairman. Particularly for entrepreneurs and policy advocates looking to launch crypto-based US companies in the United States, the ability to develop short- to medium-term plans is an essential part of the capital raising and deployment process. Given that the SEC has actively and publicly waged a campaign against crypto entrepreneurs, even moderating legalistic tactics would provide a tailwind for the sector.

An SEC that is actually responsive and open to discussions with the crypto sector about establishing companies and tokens not only allays concerns about regulatory overreach, but would – virtually by default – provide a boon to the space. Following the bull market in cryptoassets following the election of President Trump, this multi-trillion dollar asset class will play a leading role in financial markets going forward; An SEC that is open to these discussions (even without adopting an open policy) will help attract capital to the US to further these efforts.

Crypto Advisory Board

One of the most crypto-friendly signs to come out of the Trump transition team is that the Trump White House plans to create a formal crypto advisory council. Aside from the speculation about strategic Bitcoin reserves and other speculative initiatives, the fact is that prioritizing cryptocurrencies at the federal level will have several benefits. First, it suggests – along with the possibility of a pro-crypto SEC – that the US is officially open and changeable to crypto investors and entrepreneurs. Second, a thriving crypto ecosystem will also be beneficial for other emerging sectors such as AI and GenAI, both of which are critical to future leadership in technology-enabled industries.

Without a direct connection to the SEC and with full consideration of the fact that the SEC has its own agenda and mission, focusing on crypto at both the regulatory and executive levels will allow for more comprehensive communication.

Regardless of who will lead the SEC starting in 2025, crypto investors and advocates should be cautiously optimistic and prepared for substantive conversations and positive progress.