TL;DR
- SEC acknowledges in an internal 2025 review that previous crypto enforcement was misleading and a waste of resources
- Seven high-profile cases from the Gensler era are being dropped, including cases against Coinbase, Binance, and Kraken
- The number of enforcement actions against the crypto industry fell by 60 percent in 2025, and fines were reduced to under 3 percent of the 2024 level
- New focus is directed towards actual fraud and market manipulation — not registration issues
From Victory Dance to Self-Criticism
In November 2024, the U.S. financial regulator SEC celebrated 583 enforcement actions and a record-high $8.2 billion in fees and damages. The crypto industry was highlighted as proof that the regulator was keeping pace with new threats. The tone was triumphant.
The picture looks radically different today. According to CryptoSlate, the SEC has now published a new review describing the same approach as a mistake. The report concludes that resources were misprioritized and that the pursuit of “media headlines” came at the expense of real investor protection.
The pursuit of record penalties was prioritized over actual investor protection, the regulator itself admits.
Seven Cases Dropped — Major Names Affected
From February 2025, the SEC systematically began dropping cases initiated under former chief Gary Gensler. Among the entities now getting off are Coinbase, Binance, Consensys, Kraken (Payward), Cumberland DRW, Dragonchain, and Balina.
The regulator itself has acknowledged that several of these cases “did not provide meaningful benefit to investors, were based on a misinterpretation of securities law, and represented a misallocation of resources,” according to the research basis reviewed by 24Krypto.
New Leadership, New Course
The appearance of a drastic policy change has followed Paul Atkins since he took over as SEC Chair in April 2025. Under his leadership, the regulator has established a dedicated Crypto Task Force and renamed the former crypto enforcement unit to “Cyber and Emerging Technologies Unit.”
The signal is clear: the focus is shifting from registration cases and legal innovations to concrete offenses such as fraud, market manipulation, and breach of trust.
In addition, SEC staff have clarified that Proof-of-Work mining is not considered securities trading, and that transactions in meme-coins, in most cases, also do not fall under securities law — two clarifications the industry had long sought.
Moving Forward: New Framework for Token Financing
In April 2026, Atkins presented the framework “Regulation Crypto Assets” (Reg Crypto), which formalizes the direction set in 2025. The framework introduces a two-track system for token financing: startups can raise up to $5 million over four years, while established projects can raise up to $75 million annually — with simplified disclosure requirements.
The question many are asking is whether this is a necessary correction, or if the pendulum is now swinging too far in the opposite direction. It is currently too early to say what long-term effect the new approach will have on investor protection in the crypto market.
