SEC: Cryptocurrency will be a focus of scrutiny in 2025 regardless of US election outcome

The U.S. Securities and Exchange Commission (SEC) has listed cryptocurrency as a focus of its 2025 examinations. The regulator's examination division has specifically listed spot Bitcoin and Ethereum exchange-traded products as priorities, planning to review them after their launch in 2024. The U.S. Securities and Exchange Commission (SEC) has once again included cryptocurrency in its examination priorities for next year, despite potential changes in its leadership and government control. In a notice released on October 21, the SEC's examination division listed its 2025 priorities, including crypto assets and their "related products and services." According to the regulator, it plans to focus on "activities involving the provision, sales, recommendations, advice, trading, and other actions related to crypto assets," explicitly mentioning spot Bitcoin and Ethereum exchange-traded products. The SEC stated: "Given the volatility and activity in the crypto asset markets, the division will continue to monitor and, as appropriate, examine registered entities providing crypto asset-related services." It added: "The division will assess registrants' practices to address technological risks associated with the use of blockchain and distributed ledger technology, including risks related to crypto asset security." According to Acting Director of the SEC's Examination Division, Keith Cassidy, the listed priorities identify "key areas of potential increased risk and related harm to investors," suggesting the Commission will not change its stance on digital assets in 2025. Chair Gary Gensler stated the division will help participants "understand the rules" and emphasized the need for investor protection and capital formation. The increase in spot crypto ETFs marks a shift in the regulator's 2024 examination focus. The SEC first approved a spot Bitcoin ETF in January and a spot Ethereum product in May. While Gensler's term is set to end in June 2026, many experts suggest he may depart the SEC as early as January 2025 with the new presidential administration. At a Bitcoin conference in July, Republican candidate Donald Trump pledged to "fire the head of the SEC on the first day" if re-elected. There are also reports that Democratic Vice President Kamala Harris is considering potential replacements. Many have criticized the SEC's "regulation by enforcement" approach under Gensler, as the Commission has filed several lawsuits against crypto firms, alleging they offered unregistered securities. Although the U.S. Supreme Court's June opinion overturning the longstanding Chevron doctrine may impact the SEC's future courtroom performance, the Commission still has pending cases against the likes of Coinbase and Ripple.