SEC's New Crypto 2.0 Task Force Gets to Work
At the Same Time, Division of Enforcement's Own Crypto Unit Undergoes Staff Shakeup
On Feb. 4, 2025, SEC Commissioner Hester Peirce, in her role as head of the Commission's newly minted Crypto Task Force, provided additional detail regarding the task force's objectives. She began by managing expectations, describing the Task Force's work as a "journey" that "will take time," particularly with respect to "[d]etermining how best to disentangle" the "many cases" in pending litigation. "Please be patient," she said. "The Task Force wants to get to a good place, but we need to do so in an orderly, practical, and legally defensible way."
During the same period, significant changes to the SEC Division of Enforcement's Cyber and Crypto Unit (CACU) were publicly reported, including the reassigning of staff to other tasks within the division and at least one unit leader reassigned to a non-Enforcement post, this just two years after the agency beefed up CACU headcount as it pursued a flurry of alleged failure-to-register and fraud-related cases.
In her statement, Commissioner Peirce identified 10 Task Force priorities:
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Clarify the status of different categories of crypto assets as securities |
Identify crypto assets or related areas that fall outside the SEC's jurisdiction |
Explore a possible safe harbor for certain coin and token offerings |
Find a practical path to registering crypto asset securities |
Rework Special Purpose Broker Dealer no-action letters to better account for broker-dealers who custody a mix of digital assets |
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Provide practical custody rules for investment advisors |
Provide clarity regarding the application of securities laws to crypto lending and staking |
Clarify the approach used when considering crypto exchange-traded products for approval |
Work on rules relating to clearing agencies and transfer agents with respect to crypto |
Consider ways to facilitate a "cross-border sandbox" for international crypto projects |
Commissioner Peirce explicitly welcomes requests for no-action letters – something not seen in some time with respect to crypto. Many will welcome a return to the practice of issuing crypto no-action letters. Such official statements of the SEC, which are publicly available on its website, may provide crypto industry participants a better understanding of the regulatory risks while the Task Force works toward its objectives.
Commissioner Peirce concluded her statement by again soliciting public comment and providing a form for requesting meetings with the Task Force "to discuss approaches to addressing issues related to regulation of crypto assets[.]" Persons requesting meetings are asked to provide a summary of the issues to be discussed, with the summary (and any other public comments) to be posted to the SEC's website. The SEC is not known for inviting market participants to request meetings with it, and many will undoubtedly take the Commissioner up on her offer.
The SECond Opinions Blog will continue to monitor crypto-related activity and provide updates. If you need additional information on this topic – or any topic related to securities enforcement or investigations – please contact the authors or other members of Holland & Knight's Securities Enforcement Defense Team.