Launchy Regulatory Roundup #13 - Pro-Crypto Candidates in Line to Replace SEC Chief

Potential Impact of the Election Result on Crypto | Commercialization of Tokenization

Marco Manoppo & Muhammad Reynaldi Ariananda Arkiang
November 10, 2024

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Good Morning.

Welcome to our 13th edition of the regulatory roundup. If you know anybody who would benefit from this content, please help us spread the word!

This issue covers the potential SEC leadership shifts and how a Trump victory in the 2024 US election could influence crypto regulations, with a focus on policies that may prioritize innovation and market-friendly approaches.

In Today's Edition:

Headline: Pro-Crypto Candidates in Line to Replace Gary Gensler 🔄
Global Legal Roundup: ETFs Delay, Commercialization of Tokenization 🚨
Case Study: Potential Impact of the 2024 Election on US Crypto Regulation 🔑

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HEADLINE

Pro-Crypto Candidates in Line to Replace SEC Chief Gary Gensler

IMG: Yahoo Finance

State of play: Donald Trump pledged to remove Gary Gensler if elected, and now that he is in office, the question is: who will succeed Gensler, and what will their approach mean for the future of crypto regulation?

Here are potential successors to Gensler, according to Cointelegraph:

Hester Peirce ("Crypto Mom") - Current SEC Commissioner and popular with crypto advocates, Peirce has openly criticized Gensler’s strict approach.

Known for her pro-crypto views, she is a favourite among industry insiders, though she has indicated she may leave the SEC when her term ends in 2025.

Chris Giancarlo ("Crypto Dad") - Former CFTC head, Giancarlo introduced Bitcoin futures trading and advocates for blockchain innovation.

As co-chair of Willkie Farr and Gallagher’s digital works practice, he remains an influential figure in crypto circles and a strong contender for an SEC role.

Mark Uyeda - An SEC Commissioner who criticized Gary Gensler's crypto policies in October, calling them a "disaster for the industry."

Chris Brummer - A Democratic favourite with extensive experience in financial regulation, Brummer focuses on balanced crypto guidelines.

Known for creating Bluprynt, a regulatory compliance company, he is seen as a pragmatic choice who could bring a more cooperative regulatory approach.

Paul Atkins - Former SEC Commissioner under George W. Bush, Atkins supports a deregulated financial system.

He was also part of Trump’s 2016 transition team, suggesting he could bring a laissez-faire perspective to the SEC.

Erica Williams - Chair of the Public Company Accounting Oversight Board, Williams has extensive experience within the SEC.

While not vocal on crypto, her balanced approach to financial oversight could offer a middle ground, supporting regulation without stifling innovation.

Heath Tarbert - Former CFTC Chair with government experience across multiple agencies, Tarbert is now the chief legal officer at Circle.

Robert Stebbins - Former SEC general counsel and a Trump associate, Stebbins has deep expertise in corporate governance and enforcement.

Dan Gallagher - Chief legal officer at Robinhood and former SEC Commissioner, Gallagher is known for his critiques of federal oversight and past involvement in key market events, such as the GameStop trading halt.

What’s Next: Dismissing Gensler would require proving cause, such as inefficiency or neglect, a complex process that could take over a year. Even with a Trump victory, Gensler might stay temporarily or choose to resign.

Why it Matters: With Republicans typically favouring a pro-innovation stance and Democrats leaning toward consumer protections, the next SEC chair’s approach to crypto regulation could significantly impact the industry’s future.

Our Take: Hester Peirce and Chris Giancarlo are seen as the best options. Peirce, a strong crypto advocate, and Giancarlo, who helped introduce Bitcoin futures, would bring a balanced, pro-innovation approach that supports industry growth.

GLOBAL LEGAL ROUNDUP

North America:

🇺🇲 SEC mulls approving Ethereum ETF options.
🇺🇲 Detroiters will be able to pay taxes in crypto next year.
🇺🇲 US regulators mull approving Grayscale crypto index ETF.
🇺🇲 Crypto mixer Bitcoin Fog founder receives 12.5-year prison sentence.
🇺🇲 FTX tries to reclaim $11M from Crypto.com-controlled Alameda account.

Europe:

🇫🇷 France considers ban on crypto betting platform Polymarket.
🇳🇴 Norway supports MiCA, considers CBDC for financial stability.
🇵🇱 Crypto.com faces scrutiny in Poland as regulator issues public warning.
🇸🇬 🇫🇷 Singapore & France monetary authorities test quantum-proof security.

APAC:

🇸🇬 Singapore pushes for the commercialization of tokenization.
🇵🇰 Pakistan moves to regulate cryptocurrency, CBDCs as legal tender.
🇭🇰 Chinese Nationals gain access to stablecoins in Hong Kong via new trial.

CASE STUDY

Potential Impact of the 2024 Election on US Crypto Regulation

Presidential Election Results (Source: Google)

Credits to Lewis Cohen, Sarah Chen, and Morrease Leftwich for the original article.

State of play: Under a second Trump administration, with a Republican-controlled Senate and key agencies, the approach to crypto regulation is expected to be more favourable toward innovation.

The immediate impact will be seen through leadership changes at key agencies like the SEC, CFPB, OCC, and CFTC.
Policy shifts will likely focus on addressing fraud and market manipulation rather than technical infractions.
There may be a reduced emphasis on strict securities classifications for crypto assets.
Trump’s administration may also support legislation for stablecoins and a more supportive regulatory approach for banks engaging with crypto.
While comprehensive crypto legislation may not be a priority, stablecoin regulation could be an early focus.
Trump's promises, like eliminating capital gains taxes on BTC and creating a "federal bitcoin reserve," are unlikely to be passed but could have an impact on the market.
Enforcement strategies may shift towards clear fraud cases with a more practical approach to compliance.

Our Take: Under a second Trump administration, US crypto regulation will likely focus on innovation, with leadership changes at key agencies.

The emphasis will shift to addressing fraud and market manipulation, with less strict securities classifications for crypto assets.
Stablecoin regulation and bank support for crypto will be priorities, but Trump’s tax proposals are unlikely to pass.
Enforcement will focus on fraud and practical compliance.

Take a peek at our referral reward at the bottom of this issue. Share this newsletter and receive our comprehensive database of crypto regulations around the world👇

NOTEWORTHY READS & MEME

Kristin Smith’s opinion on crypto’s political triumph.
Marissa Coppel’s opinion on Gensler’s crusade against crypto.
CCI’s comment letter on the IRS draft Form 1099-DA and its instructions.

it really do be like that tho
— Alex Thorn (@intangiblecoins)
1:28 PM • Nov 8, 2024

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