Crypto Lawsuits: Ex-SEC Official Criticizes Agency over Shifting Regulatory Stance

The US Securities and Exchange Commission is undergoing transformation under President Donald Trump’s administration, paving the way for a major regulatory overhaul. In an attempt to dismantle its enforcement regulations, the SEC has ended major crypto lawsuits, sparking optimism. However, former SEC official John Reed Stark criticizes this regulatory shift, addressing it as the agency’s death.

SEC Closes Crypto Lawsuits Sparking Criticism from Ex-Official

The restructured SEC is spearheading a major regulatory overhaul under President Donald Trump. As a result, the regulators settled prolonged crypto lawsuits initiated during former Chair Gary Gensler’s tenure. While the commission’s move sparked widespread enthusiasm within the crypto space, former SEC official John Reed Stark expressed sharp criticism via his recent X post.

Notably, the agency has resolved multiple crypto lawsuits involving Coinbase, Robinhood, Uniswap, and OpenSea. The SEC’s progressive approach has invoked enthusiasm regarding a potential revolution in the US crypto regulatory landscape.

However, Stark views this regulatory shift as a symbol of destruction. He deems it as the commission’s death, stating, “This is How the SEC Dies.”

Are All SEC-Crypto Lawsuits Paused?

In a previous post, Reed highlighted the agency’s recent regulatory shifts that resulted in the resolution of major crypto lawsuits. Specifically, the SEC dropped the Coinbase and Robinhood lawsuits initially. And in a recent move, the regulators put an end to the investigations surrounding Uniswap and OpenSea. In addition, the agency has frozen the Binance lawsuit, marking at least five “pauses” in crypto lawsuits.

These developments have significantly sparked anticipations on the potential settlement of the XRP lawsuit. Despite speculations from legal experts of a potential delay in the lawsuit, Reed believes that the Ripple case would end next. In addition, expressing thoughts on the SEC’s possible move to end all existing crypto lawsuits, Reed stated,

The SEC crypto-enforcement carnage has really just begun to litter the streets. My guess is that all SEC crypto-related investigations have already been secretly “paused” and that SEC crypto-enforcement resources have already been shifted to other priorities.

SEC’s Regulatory Shift: A New Era or Demise?

“The U.S. Securities and Exchange Commission (SEC) continues its frantic race to eliminate all fragments, remnants and artifacts of its crypto-enforcement program,” stated Stark. According to the ex-official, the SEC’s current could lead to the complete destruction of the commission. He posited,

It’s the perfect storm at the SEC: A President who does not trust the SEC; A crypto czar who has no respect for the SEC; And a DOGE Director Who hates the SEC. That’s not good for SEC staff.

Stark believes that Elon Musk’s Department of Government Efficiency (DOGE) will soon restructure the regulatory agency, possibly including a reduction in workforce. In a sarcastic tone, he posited that the current shift, including the crypto lawsuits’ updates, could possibly pave the way for the regulator’s funeral.