Regulatory Priority Under New Leadership
The United States Securities and Exchange Commission (SEC) is meeting more with crypto industry leaders as it experiences a shift in leadership and regulatory priority. On April 24, the SEC’s crypto task force, led by Commissioner Hester Peirce, met with Ondo Finance executives and representatives of law firm Davis Polk and Wardwell. The agenda was the sale and issuance of wrapped, tokenized versions of publicly traded U.S. securities—a topic of significance as the agency weighs new models for oversight of digital assets.
Political and Financial Ties Raise Eyebrows
The inclusion of these firms stoked interest due to their connection with former President Donald Trump. Ondo Finance previously contributed $1 million to Trump’s 2017 inauguration fund, and Davis Polk recently revealed that it was advising Truth Social, Trump’s media company, on the launch of crypto-linked exchange-traded funds (ETFs). Possible registration requirements, compliance strategies, and the creation of a regulatory sandbox for firms seeking clarity on tokenized offerings were also discussed during the SEC meeting.
A New Chapter for SEC Crypto Oversight
The discussion took place days after former SEC Chair Gary Gensler stepped down and was replaced by Paul Atkins, a Trump-era commissioner. Atkins took office on April 21, and although he is yet to implement concrete policy action, his assuming of office has created expectations of a more crypto-friendly approach. The meeting of April 24 may be an early sign of a move for regulatory reforms under the new management.
Continued Industry Outreach and Enforcement Inquiries
The SEC is ongoing in its outreach to the cryptocurrency industry, with a roundtable set to take place on April 25 to talk about custody of digital assets. The session will involve firms like Kraken, Anchorage Digital, and WisdomTree. The events come amid regulatory interest in institutional cryptocurrency services after the approval of several spot crypto ETFs earlier this year in 2024.
Still, the agency’s enforcement strategy is murky. Although regulators indicate they’ll target fraudulent actors, they dropped a case against Richard Heart and closed investigations into Ripple, Coinbase, and Kraken—businesses also linked to Trump via executive donations or campaign support. Whether this trend is a broader regulatory shift remains to be seen.
