SEC dropped crypto cases to avoid its own lawyers face-planting in court, Uyeda says 🫠

The U.S. Securities and Exchange Commission dropped civil enforcement actions against cryptocurrency companies in early 2025 because continuing to litigate under soon-to-be-obsolete positions could have damaged the agency's credibility, former acting Chair Mark Uyeda said Wednesday. Speaking at the Psaros Center for Financial Markets and Policy's Financial Markets Quality Conference, Uyeda described the dismissals as preparation for a "180-degree change" in the agency's approach to crypto rulemaking.

Uyeda, who led the SEC from January to April 2025 before Paul Atkins's confirmation as chair, said there had been "significant concerns" about whether the cases against crypto firms were "justifiable under law." Rather than allow staff attorneys to argue precedent the commission was preparing to reverse, Uyeda said he moved to end the litigation. "I'm not about to have our litigators, even though they're having cases that were authorized under the prior administration, stand up in court and have a commission interpretation be issued that is a 180-degree change from what they'd been arguing for that court," he said. "I think that hurts [our] credibility as an agency."

The dropped cases had been filed under former Chair Gary Gensler and targeted firms including Kraken, Ripple Labs and Coinbase. Critics characterized the dismissals as payback for the crypto industry's support of President Donald Trump's 2024 campaign; Trump had pledged to fire Gensler "on day one," and Gensler resigned the day Trump took office. Uyeda has served as an SEC commissioner since 2022 and remains on the agency alongside Atkins and Commissioner Hester Peirce.

With Peirce's departure expected in November, the SEC will have only two of its five commissioner seats filled, and Trump has not yet announced nominees to fill the vacancies. Separately, the agency recently granted a temporary exemption allowing tokenized U.S. stock trading, a step that reflects its broader reassessment of digital asset policy under the current administration.