SEC Drops Crypto Exchange Rule, Signals Regulatory Shift

The SEC is pulling back on a proposed rule that could have expanded its oversight of crypto exchanges . The rule, introduced under former SEC Chair Gary Gensler , aimed to redefine what qualifies as an exchange by including certain communication protocols . Critics argued that the broad wording could have unintentionally regulated platforms that weren’t designed to be under SEC control. Now, acting Chair Mark Uyeda has moved to withdraw the proposal, signaling a major shift in the agency’s regulatory stance. This decision aligns with broader changes happening at the SEC under new leadership appointed by President Donald Trump . In recent weeks, the agency has also dropped at least six enforcement cases against major crypto companies, including actions targeting Kraken, Coinbase, Robinhood, and MetaMask . This suggests a significant easing of regulatory pressure, which had been a point of contention for crypto industry leaders and investors. Alongside these rollbacks, the SEC Crypto Task Force , now led by Commissioner Hester Peirce , is adopting a more collaborative approach to digital asset regulation. The task force, which includes experts like Richard Gabbert, Michael Selig, Taylor Asher, and Sumeera Younis , has announced a series of industry discussions. These “Spring Sprint Toward Crypto Clarity” roundtables will begin on March 21 , providing a platform for policymakers, industry leaders, and legal experts to address regulatory challenges and discuss the future of compliance in the crypto space. With these developments, the SEC appears to be stepping away from its aggressive enforcement stance under Gensler and instead focusing on engagement and clarity . This shift is expected to have significant implications for how crypto businesses operate in the U.S., potentially paving the way for a more open and innovation-friendly regulatory environment . However, it remains to be seen how much influence the SEC will maintain over the rapidly evolving digital asset industry and whether these changes will lead to clearer, long-term rules for crypto firms.