The U.S. Securities and Exchange Commission (SEC) is undergoing a major shift in its approach to cryptocurrency enforcement, marked by a series of legal retreats and internal restructuring. Because of this shift, former SEC director John Reed Stark has suggested that the agency’s appeal in its case against Ripple is likely to be abandoned.
Legal Setbacks and Strategic Retreats
In recent months, the SEC has stepped away from key legal battles and slowed down its cryptocurrency regulation practices. One significant move was its decision to drop the Coinbase lawsuit regarding the exchange’s status as a securities dealer.
This retreat signals a shift in the agency’s enforcement priorities under acting SEC Chair Mark Uyeda—a shift expected to continue once Paul Atkins, Donald Trump’s nominee, is confirmed. John Reed Stark, a former SEC lawyer, has pointed to these developments as evidence that the SEC’s aggressive stance on digital assets is collapsing.
In a post on X, Stark commented on the agency’s shifting direction, drawing attention to the end of the Coinbase lawsuit and predicting that Ripple’s appeal would be next. Stark previously argued that the SEC is no longer pursuing the same level of enforcement against digital assets and that this pattern is unlikely to change soon.
As Predicted, Like the Rest of the SEC's Crypto-Enforcement Program, the SEC Coinbase Case is Dead. The SEC Ripple Appeal is Obviously Next on the Chopping Block.
Uncle. https://t.co/nM2IQlAFKc
— John Reed Stark (@JohnReedStark) February 21, 2025
We are on twitter, follow us to connect with us :- @TimesTabloid1
— TimesTabloid (@TimesTabloid1) July 15, 2023
Ripple Appeal Likely to Be Dropped
Stark has emphasized that the SEC’s retreat extends beyond individual cases, reflecting a fundamental reassessment of its regulatory authority over digital assets. He asserted that the agency would no longer initiate legal actions asserting that cryptocurrencies are securities until a newly established crypto task force completes its review of crypto-related policies.
This task force, led by SEC Commissioner Hester Peirce, often called “Crypto Mom,” is expected to play a key role in determining the agency’s next steps in regulating digital assets, and could prioritize swift resolution to these lawsuits.
Regulatory Overhaul and Internal Changes
The SEC’s evolving stance on cryptocurrency enforcement is accompanied by significant internal restructuring. The agency recently rebranded its crypto enforcement division as a cyber unit, signaling a shift in focus.
Additionally, key figures like Jorge Tenreiro, who were involved in previous crypto-related litigation, have been reassigned, signaling a potential retreat from aggressive enforcement actions.
He also pointed to broader institutional instability, citing a recent Department of Justice letter that questioned the legal foundation of the SEC administrative law judges. This challenge could lead to the removal of SEC judges, further weakening the agency’s enforcement capabilities.
With the Ripple appeal potentially on the verge of being dropped, XRP Investors are preparing for a massive move, and the asset is already showing positive signs.
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