The United States Securities and Exchange Commission (SEC) has reaffirmed its commitment to scrutinizing cryptocurrencies in its examination priorities for the upcoming year, even amid potential leadership changes within the regulatory body and the government.
In a notice issued on October 21, the SEC's Division of Examinations outlined its key focus areas for 2025, prominently including crypto assets and their associated products and services. This move underscores the regulator's ongoing intention to monitor the rapidly evolving crypto landscape.
The SEC explicitly highlighted its intention to concentrate on various activities related to crypto assets, including their offering, sale, recommendation, advice, trading, and other associated functions. Notably, the examination priorities specifically named spot Bitcoin (BTC) and Ethereum (ETH) exchange-traded products, reflecting their anticipated launch in 2024.
“Given the volatility and continued activity in the crypto asset markets, the Division will persist in its oversight and, where appropriate, conduct examinations of registrants providing services related to crypto assets,” the SEC stated. The agency also indicated that it would evaluate registrant practices in relation to the technological risks linked to blockchain and distributed ledger technology, particularly concerning the security of crypto assets.
Keith Cassidy, the Acting Director of the SEC's Division of Examinations, noted that the identified priorities represent critical areas where potential risks and investor harm could arise. This suggests that the SEC's approach to digital assets will remain steadfast in 2025, focusing on investor protection and promoting capital formation.
Chair Gary Gensler emphasized that the division's efforts aim to help market participants "understand the rules," reinforcing the SEC's objective of safeguarding investors in the burgeoning crypto sector.
The incorporation of spot cryptocurrency exchange-traded funds (ETFs) into the SEC's examination agenda marks a departure from its 2024 priorities. The SEC first granted approval for spot Bitcoin ETFs in January, followed by the greenlighting of spot Ethereum products in May.
Potential Shifts in Leadership?
While Gensler's term is set to conclude in June 2026, speculation abounds that he may step down earlier, potentially in January 2025, should a new presidential administration take office. Republican candidate Donald Trump has publicly vowed to terminate the SEC chair “on day one” if he returns to the presidency, and there are indications that Democratic Vice President Kamala Harris is also considering possible successors.
The SEC's enforcement-centric approach under Gensler has drawn criticism, especially as the commission has initiated multiple lawsuits against various cryptocurrency firms, alleging unregistered securities offerings. Furthermore, a June ruling by the U.S. Supreme Court that overturned the long-standing Chevron doctrine could influence the SEC's effectiveness in court. Despite these shifts, the commission continues to have pending cases against major players like Coinbase and Ripple.
As the SEC moves forward with its 2025 examination priorities, the focus on cryptocurrencies reflects ongoing regulatory challenges and the need for a clearer framework in the rapidly evolving crypto ecosystem.
