Former U.S. SEC official John Reed Stark tweeted today that the SEC has suspended the litigation against Coinbase (similar to the Binance case), and the SEC's appeal against Ripple is also expected to be suspended. Stark believes that based on the current situation, the SEC's enforcement actions against cryptocurrencies are officially coming to an end.

SEC Suspends Enforcement Actions Against Coinbase, Binance

Stark stated that on the 14th, the SEC filed documents with the Second Circuit Court, indicating that its newly formed Cryptocurrency Task Force may facilitate a resolution of the SEC's enforcement case against Coinbase, and therefore the SEC needs a brief delay in responding to Coinbase's appeal request regarding whether the platform's transactions are subject to securities laws.

According to this unprecedented three-page joint motion, the SEC is still "reviewing" issues related to cryptocurrencies and hopes to use this delay to conduct "appropriate review" in preparation for responding to Coinbase's petition. (Stark's plain-language interpretation: This litigation is over.)

Similarly, the SEC recently filed a joint motion with the exchange Binance in the U.S. District Court for the District of Columbia, requesting a two-month suspension of enforcement actions against Binance, citing that the SEC is adjusting its approach to the regulation and enforcement of digital assets.

These two similar reasons for suspending enforcement actions have led Stark to believe that the SEC intends to temporarily suspend its crackdown on the cryptocurrency industry.

Further reading: Binance and SEC Jointly Apply for a 60-Day Suspension of Review - Reconciliation in Sight?

Is the SEC Facing a Major Shakeup?

Stark then mentioned that the SEC's cleanup action may have already begun, as Jorge Tenreiro, the core lawyer responsible for major cryptocurrency litigation cases such as Ripple, Coinbase, and Binance, has been transferred to the Information Technology (IT) management department:

However, this SEC litigation attorney - who had led the SEC to victory in the Coinbase and Binance cases - has now disappeared from these cases, ordered to pack up his notebooks and legal documents and move to the SEC's IT department.

Yes, you read that right. Yesterday he was the top litigation attorney in the SEC, standing in court against the world's top law firms and repeatedly winning; today, he's been transferred to fix printers.

In his place, these cryptocurrency cases are now being handled by the legal team at SEC headquarters (Washington, D.C.), who are apparently under the direction of the acting SEC Chair.

Additionally, according to LinkedIn information, the SEC Enforcement Division's "Crypto Assets and Cyber Unit" has quietly been renamed the "Cyber and Emerging Technologies Unit".

Stark: The SEC May Fully Suspend Cryptocurrency Investigations, Litigations, and Appeals in the Future

As for the SEC's future measures in the cryptocurrency field, Stark stated that as the only federal regulator authorized by Congress to define "securities" and enforce investor protection rules, the SEC has consistently determined that almost all cryptocurrencies are securities, and this view has been held by both Republican and Democratic-led SEC administrations, with the courts also repeatedly affirming the SEC's position.

However, Stark made the following predictions about the SEC's future cryptocurrency enforcement plans:

• SEC Cryptocurrency Investigations: All formal and informal SEC investigations into cryptocurrencies will be fully suspended.
• SEC Cryptocurrency Litigations: The SEC will instruct its Litigation Division to suspend all cryptocurrency-related litigations or accelerate the resolution of cases on terms favorable to the defendants.
• SEC Cryptocurrency Appeals: All cryptocurrency-related appeals, including the Ripple appeal, will be suspended or more likely directly withdrawn.

Stark believes that the SEC's current cryptocurrency enforcement division has already disintegrated, and therefore, regardless of how many times the courts have previously ruled that digital assets are securities, these rulings are now meaningless:

Although the courts have repeatedly ruled that digital assets are securities, these rulings are now meaningless. Regardless of how the acting SEC Chair or the incoming new SEC Chair packages the "suspension" of the Binance, Coinbase (and the upcoming Ripple) cases, the SEC's cryptocurrency enforcement division is dead.