SEC Crypto Enforcement Actions Dropped 30% in Gensler’s Final Year

In former SEC Chair Gary Gensler’s final year, crypto-related enforcement actions by the U.S. Securities and Exchange Commission (SEC) dropped by 30%, according to a report by Cornerstone Research on January 23. The agency initiated 33 crypto-related actions in 2024, down from 47 in 2023, its peak year for enforcement.

During 2024, the SEC charged 90 defendants or respondents, including 57 individuals and 33 firms. Administrative proceedings saw a significant decline, dropping by over 50%. However, monetary penalties hit a record high of nearly $5 billion, largely due to a $4.5 billion settlement with Terraform Labs.

Gensler, appointed by President Joe Biden in 2021, stepped down as SEC chair on January 20, coinciding with Donald Trump taking office. Over half of the SEC’s crypto enforcement actions in 2024 occurred in September and October, with only four cases initiated post-November elections.

The SEC’s most common allegation in crypto enforcement was fraud, present in 73% of cases, followed by unregistered securities offerings at 58%. The agency also pursued more cases involving market manipulation and failure to register as broker-dealers. Under Gensler, the SEC pursued almost 80% more crypto enforcement actions compared to the tenure of Jay Clayton, who chaired the SEC from 2017 to 2020.

Comparison of SEC administrations. Source: Cornerstone Research

Since 2013, nearly 47% of the SEC’s 207 crypto-related enforcement actions have targeted initial coin offerings (ICOs) and non-fungible tokens (NFTs). Under its new acting chair, Mark Uyeda, the SEC has already shifted priorities, including canceling the controversial Staff Accounting Bulletin 121 on January 23. This rule had required banks and financial firms holding crypto to record the assets as liabilities on their balance sheets.