Caroline Crenshaw, the only Democrat currently serving on the US Securities and Exchange Commission (SEC), raised concerns about the SEC’s shift in approach to crypto oversight.
Speaking at the SEC Speaks event on May 19, she said the agency is removing key rules without proper review, and compared the situation to a game of Jenga, where pulling out too many blocks can bring the whole tower down.
Crenshaw stated that the SEC had spent years building a system of rules meant to support market stability. She warned that some of those rules are being taken apart in ways that could create new risks, especially in the crypto industry.
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She said that the SEC has used internal guidance to quietly weaken or reverse existing policies, without involving the public or fully explaining the reasons. These actions showed that the agency might not fully enforce the rules in some crypto-related situations.
Crenshaw also criticized what she called “regulation by non-enforcement”, which pointed out that the SEC has stepped back from taking action in many areas. She believes this damages the agency’s ability to win in court and creates confusion about which rules still apply.
To make her point, she used the collapse of FTX in 2022 as a reminder of what can go wrong when crypto markets are left unchecked. Crenshaw noted that while the risks still exist, the urgency to address them seems to have faded.
Meanwhile, SEC Chair Paul Atkins recently discussed how blockchain could introduce new methods for managing investments. What did he say? Read the full story.
Having completed a Master’s degree in Economics, Politics, and Cultures of the East Asia region, Aaron has written scientific papers analyzing the differences between Western and Collective forms of capitalism in the post-World War II era.With close to a decade of experience in the FinTech industry, Aaron understands all of the biggest issues and struggles that crypto enthusiasts face. He’s a passionate analyst who is concerned with data-driven and fact-based content, as well as that which speaks to both Web3 natives and industry newcomers.Aaron is the go-to person for everything and anything related to digital currencies. With a huge passion for blockchain & Web3 education, Aaron strives to transform the space as we know it, and make it more approachable to complete beginners.Aaron has been quoted by multiple established outlets, and is a published author himself. Even during his free time, he enjoys researching the market trends, and looking for the next supernova.
