SEC Pauses Crypto Enforcement, Signaling Shift in Strategy

The U.S. Securities and Exchange Commission (SEC) has recently signaled a shift in its approach to cryptocurrency enforcement, pausing legal proceedings against major players in the industry. This change in strategy comes as the agency delays cases against Coinbase and Binance, with experts predicting a similar fate for the long-running Ripple lawsuit.

On Friday, the SEC informed the Second Circuit Court that its newly formed Crypto Task Force could lead to a resolution in the Coinbase case. The agency requested additional time before responding to Coinbase’s appeal regarding the application of securities laws to transactions on its platform. This move followed a similar action in the Binance case, where both parties filed a joint motion seeking a two-month pause in proceedings.

Former SEC official John Reed Stark brought attention to these changes through social media, highlighting a key organizational shift within the agency. The unit previously known as the “Crypto Assets and Cyber Unit” has been renamed to the “Cyber and Emerging Technologies Unit,” suggesting a broader focus beyond cryptocurrency enforcement.

The timing of these changes coincides with the anticipated leadership transition at the SEC, as Paul Atkins prepares to take charge of the agency. This leadership change appears to be influencing the direction of crypto-related enforcement actions.

In the Coinbase case, both the SEC and the cryptocurrency exchange agreed to delay court proceedings, citing ongoing regulatory discussions. This collaborative approach marks a shift from the previously adversarial relationship between the agency and crypto companies. The same pattern emerged in the Binance case, where both parties agreed that a temporary pause would allow the SEC to reassess its position on digital assets.

Legal experts watching these developments have turned their attention to the Ripple lawsuit, which has been a central focus of the crypto industry since its inception. Attorney Jeremy Hogan suggests that a settlement in the Ripple case might precede any approval of an XRP exchange-traded fund (ETF). The chances of an XRP ETF approval have increased to 80% according to polymarket, and the SEC has acknowledged three ETF applications so far.

The market has remained relatively stable despite these developments. XRP, Ripple’s cryptocurrency, traded at $2.52, showing a 2% decrease in line with broader market movements. The price ranged between $2.47 and $2.62 over the past 24 hours.

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