As a seasoned observer of the ever-evolving world of cryptocurrencies and blockchain technology, I find myself intrigued by the potential changes that could ensue under the leadership of William Hinman, the new nominee for the position of SEC chairman. Hinman’s extensive background in both law and finance, coupled with his deep understanding of the digital asset space, makes him a compelling choice to guide the SEC through this complex and rapidly changing landscape.
As an analyst, I am excited to share that I have been part of the team helping President-elect Donald Trump in making key decisions for his administration. One such decision is appointing Paul Atkins, a pro-crypto businessman and former SEC commissioner, as the new chair of the Securities and Exchange Commission (SEC). This move aligns with the president-elect’s pledge to replace the current chair, Gary Gensler, and brings joy to the crypto industry.
As a dedicated researcher, I’m keenly interested in the potential implications of Atkins for the cryptocurrency sector should his confirmation be as anticipated by Congress in 2025. Here’s what we currently understand about this prospective figure:
From SEC to Patomak and back again
From July 2002 through August 2008, Atkins held the position of a Republican member in the Securities and Exchange Commission (SEC), which was granted during the administration of George W. Bush.
Back then he was already pro-innovation and investment and against red tape:
In his 2007 speech at the Corporate Directors Forum, Atkins stated that “[The SEC] should not make it too expensive for investors to participate in our markets through excessive regulations or take away the returns on their investments with irrational rules.
As per the insights shared by US law firm Anderson PC., Atkins was recognized for his approach to emphasize “fairness,” in regulatory actions, advocating against excessive penalties for corporations due to individual misconduct, and instead focusing on intricate and multifaceted cases rather than prioritizing a high volume of enforcement actions.
In his guidance, the Securities and Exchange Commission (SEC) might shift focus from confrontational strategies that mainly target sensational fines to ones that emphasize meaningful results instead,” suggested Anderson attorneys.
On the latest episode of Unchained podcast, Cody Carbone, president of Digital Chamber, highlighted one advantageous aspect of Atkins: his prior relationship with the existing team at the Securities and Exchange Commission (SEC), notably Republican commissioners Hester ‘Crypto Mom’ Peirce and Mark Uyeda.
Both Peirce and Uyeda were staffers for Atkins during his six-year stint at the agency.
According to Carbone, when considering how the commission will operate in the future, they possess a sense of familiarity because they’ve already worked side by side, even going through battles together.
As a former SEC employee, I stepped into the world of crypto investing and entrepreneurship by establishing Patomak Global Partners in 2009. Our firm focuses on providing regulatory guidance, ensuring risk compliance, and offering support for enforcement and litigation matters within the financial sector.
Significantly, Patomak became a client of Sam Bankman-Fried’s collapsed exchange, FTX, in January 2022, which later faced issues approximately 10 months later.
In a 2023 podcast discussion, Atkins argued that the international scandal surrounding FTX arose due to insufficiently clear US regulations concerning digital assets. Nevertheless, he acknowledged that Sam Bankman-Fried’s fraudulent actions played the leading role in causing the platform’s downfall.
From 2017 onwards, Atkins has taken up the role of co-chair in the Token Alliance – an advocacy organization within the Chamber of Digital Commerce that focuses on cryptocurrencies. The alliance’s objective is to foster regulatory clarity and encourage broader acceptance of digital assets.
As an analyst, I’ve consistently championed the potential of digital assets and technological advancements within the financial sector. On numerous instances, I’ve publicly criticized the SEC’s regulatory strategy, led by Chairman Gensler, which appears more focused on enforcement rather than fostering a conducive environment for the crypto industry to thrive.
In 2019, Atkins appeared before Congress to discuss changes in the Securities and Exchange Commission (SEC), aiming for a balance between safeguarding investors and easing regulatory pressures on up-and-coming sectors.
SEC turnover continues
Although Trump has proposed Atkins as the upcoming SEC chairman, it’s important to note that this isn’t final until confirmed by Congress and the Senate. It’s possible for these bodies to reject a presidential nominee, which could very likely occur with some of Trump’s more contentious selections.
As a researcher, I anticipate that Carbone is optimistic about the confirmation of Atkins’s nomination by March 2025, contingent upon the pace at which the Senate Banking Committee processes nominations for various departments and organizations.
As a crypto investor, I find it noteworthy to mention that the Securities and Exchange Commission (SEC) is led by a five-member board. Currently, this board comprises two Republicans – Hester Peirce, affectionately known as “Crypto Mom”, and Mark Uyeda – and three Democrats, Caroline Crenshaw, Gary Gensler, and Jaime Lizarraga.
On the other hand, it’s been announced that both Gensler and Lizarraga will depart from the agency in January.
Currently, Crenshaw – a commissioner known for her skepticism towards cryptocurrencies who opposed the approval of Bitcoin ETFs – now faces uncertainty about her future within the agency as her renomination vote has been delayed indefinitely.
Under the incoming administration, it’s expected that the Securities and Exchange Commission (SEC) will be led by a three-member Republican majority next year after Trump’s inauguration. Some people have proposed the possibility that Trump might go against tradition and appoint an additional Republican commissioner to fill the spot vacated by Lizarraga, although this is currently only speculation.
What could Atkins’ reign look like for crypto regulation?
In a conversation with CryptoMoon, Charlyn Ho, the founder of Rikka Group, stated that while Atkins’ changes are certain, they won’t transform the regulation of the cryptocurrency sector overnight. Instead, the transformation will occur gradually.
Ho expresses doubt that the United States will follow Europe‘s lead in implementing a comprehensive regulation like MiCA for cryptocurrencies. Instead, she anticipates that under the guidance of Atkins at the SEC, the focus will shift towards offering guidance and clearing away regulatory obstacles.
As a crypto investor, I’d venture to say that both Trump and Atkins likely favor enhancing the transparency of where the cryptocurrency sector can thrive, rather than introducing fresh regulations.
To clarify, several cryptocurrency-related bills are currently being reviewed, such as those focusing on stablecoins and the Financial Innovation Technology Act 21 (FIT 21). Notably, FIT 21 has already been approved in the House of Representatives and offers a regulatory structure for digital currencies.
In essence, it’s unlikely that Atkins will adopt the same tactic as his predecessor Gensler, who faced criticism for his aggressive stance on cryptocurrency regulations. His approach was often seen as exceeding the SEC’s congressional mandate, and enforcing rules through actions rather than official legislation, a practice known as ‘regulation by enforcement.’
She stated that a recurring point in cases such as Coinbase and Ripple is the Securities and Exchange Commission (SEC) may be exceeding its jurisdiction.
As a researcher, I’d articulate it this way: “Congress has the role of enacting laws. These laws grant interpretative powers to bodies such as the SEC, yet these agencies should only exercise their interpretation within the boundaries defined by the delegated authority.
Last February 23rd, during an appearance on the Free The People podcast, Atkins expressed that if the Securities and Exchange Commission (SEC) had adopted a less confrontational approach, there could have been greater potential for American industries to expand.
In a statement, Atkins expressed that if the agency were more cooperative and transparent with these companies, it might be preferable for such events to unfold within the U.S., rather than overseas. He cited the $4.3 billion fine imposed on Binance as an example of why many crypto firms opt to stay outside the U.S. borders.
In the same podcast, Atkins expressed approval for Commissioner Peirce’s Token Safe Harbor Proposal – a legislation introduced again in 2021 – which offers a temporary exemption for crypto creators from having to register with the Securities and Exchange Commission (SEC) beforehand.
A day-one Atkins overhaul is unlikely
Although Atkins appears supportive of cryptocurrencies, Ho cautioned that those anticipating an immediate change in regulations might be jumping the gun.
Ho stated that even though a new commissioner may be appointed, it doesn’t automatically erase all the established legal work and precedents set by Gensler earlier. He still has a framework to follow.
Considering the numerous ongoing legal actions by the SEC involving companies such as Kraken, Coinbase, Ripple, among others, Ho stated that it is unlikely for Atkins or the SEC to abruptly shift their stance and aggressively support cryptocurrency without due consideration.
If Atkins wishes to modify the SEC’s stance, simply stating it isn’t enough. Instead, they must follow due process and provide a valid reason for changing their stated claims.
If the party is serving as the plaintiff, they have the option to abandon the entire lawsuit. However, if the process is already underway, the commissioner does not possess absolute power to alter every aspect of it drastically.
“He would still be bound by certain things.”
Read More
- TNSR PREDICTION. TNSR cryptocurrency
- TRB PREDICTION. TRB cryptocurrency
- RLC PREDICTION. RLC cryptocurrency
- POL PREDICTION. POL cryptocurrency
- OKB PREDICTION. OKB cryptocurrency
- CTXC PREDICTION. CTXC cryptocurrency
- GBP EUR PREDICTION
- SXP PREDICTION. SXP cryptocurrency
- SEI PREDICTION. SEI cryptocurrency
- HOOK PREDICTION. HOOK cryptocurrency
2024-12-13 02:27