Key Takeaways
- The letter identifies specific terminated proceedings that Waters considers troubling, including cases against major crypto platforms Coinbase and Binance
- She noted instances where defendant companies announced enforcement actions had been terminated before the SEC Commission formally voted on those decisions
US House Representative Maxine Waters has formally requested congressional oversight of the Securities and Exchange Commission (SEC) , citing dramatic shifts in the agency’s crypto enforcement posture under Chairman Paul Atkins and raising questions about potential political interference in regulatory decisions.
Waters, the ranking Democrat on the House Financial Services Committee, submitted a letter Sunday to Committee Chair French Hill demanding a hearing with Atkins to address what she characterizes as problematic policy reversals since the Trump administration’s return to power. The California representative highlighted that approximately 60% of the SEC’s crypto enforcement actions have been dismissed or suspended since January, representing an unprecedented regulatory retreat.
The letter identifies specific terminated proceedings that Waters considers troubling, including cases against major crypto platforms Coinbase and Binance, as well as actions involving entrepreneur Justin Sun. Waters emphasized that these enforcement matters involved credible allegations of securities law violations, yet were abandoned without public explanation of the agency’s reasoning.
Particularly concerning to Waters is the sequence of events surrounding case dismissals. She noted instances where defendant companies announced enforcement actions had been terminated before the SEC Commission formally voted on those decisions, raising questions about whether Atkins’ office engaged in unusual intervention to negotiate outcomes favorable to crypto companies.
The timing discrepancies suggest potential breaches of standard regulatory procedure, where Commission votes typically precede public announcements. Waters explicitly questioned whether the chairman’s office became “unusually active” in orchestrating these settlements, diplomatic language that implies direct personal involvement in case resolutions.
Statistical evidence supports Waters’ concerns about enforcement decline. The SEC has filed zero new crypto enforcement actions throughout 2025, a stark departure from the previous administration when former Chairman Gary Gensler oversaw dozens of annual filings.
Major cases concluded with notably lenient outcomes: Coinbase’s proceeding ended in February without financial penalties, Kraken settled in March similarly fine-free, and Binance concluded its matter in May. The Ripple case saw its penalty reduced to $125 million in August before appeals were withdrawn entirely.
Waters’ letter also outlined ten specific areas requiring congressional scrutiny, including the SEC’s institutional independence, potential politicisation of enforcement decisions, and concerns about weakened market surveillance capabilities. She ALSO drew comparisons between current regulatory relaxation and pre-1929 crash conditions, citing warnings from SEC Commissioner Caroline Crenshaw about inadequate investor protections.
The Spring 2025 regulatory agenda particularly further alarmed Waters, flagging that it proposes reducing registration requirements for securities offerings, loosening disclosure obligations, and expanding retirement account access to private markets— changes that collectively reduce oversight of investment products.
Beyond crypto-specific concerns, Waters highlighted potential market manipulation issues surrounding major policy announcements. She referenced suspicious trading patterns preceding Trump’s tariff suspension announcement and market volatility connected to administration interventions regarding Argentina, suggesting possible insider trading based on advance knowledge of government decisions.
Waters has consistently opposed what she views as excessive Republican accommodation of the cryptocurrency sector. In October, she condemned the presidential pardon granted to Binance co-founder Changpeng Zhao, previously characterising Trump family crypto ventures as potentially the “most heinous scam in contemporary history.”
Atkins assumed the SEC chairmanship in April following Trump’s nomination, replacing Gensler. Under Atkins’ leadership, the agency has adopted a markedly friendlier regulatory stance through initiatives like Project Crypto, streamlined approval processes for cryptocurrency exchange-traded funds, and systematic winding down of pending investigations.
Waters’ letter further emphasised that Committee Chair Gensler appeared twice before Congress during his first year, establishing a precedent for executive branch accountability. She noted that despite significant policy changes under Atkins, the Committee has not conducted a single oversight hearing with the current chairman, representing what she considers an abdication of congressional responsibility.
