Director Gurbir S. Grewal of the Securities and Exchange Commission (SEC) announced his resignation on Wednesday, capping a three-year tenure as the division’s head.
Grewal’s departure, effective October 11, marks the end of a 21-year career with the agency. Sanjay Wadhwa, currently the division’s deputy director, will assume the role of acting director, while Sam Waldon, chief counsel, will serve as acting deputy director.
Grewal’s Impact on Crypto Regulation in the U.S
Grewal oversaw heightened scrutiny of the cryptocurrency market in his capacity as the SEC’s top enforcement officer.
During his tenure, more than 100 enforcement actions against cryptocurrency companies were approved, including well-known lawsuits against prominent participants like Coinbase, Kraken, Ripple Labs, and foreign organizations like Binance.
These actions often focused on the SEC’s assertion that most crypto tokens qualify as securities, a stance that has drawn criticism and legal challenges from the crypto community, with some describing the SEC’s approach as “regulation by enforcement.”
Today we announced that Gurbir S. Grewal, Director of the Division of Enforcement, will depart the agency, effective Oct. 11, 2024. https://t.co/4wXy6ka0qM pic.twitter.com/mnVf378bPi
— U.S. Securities and Exchange Commission (@SECGov) October 2, 2024
SEC Chair Gary Gensler praised Grewal’s contributions to the agency, saying, “Every day, he has thought about how to best protect investors and help ensure market participants comply with our time-tested securities laws.” “He has guided a Division that has operated fearlessly and impartially, adhering to the law and the facts wherever they may lead. I greatly enjoyed working with him and wish him well.”
Grewal’s Legacy at the SEC Beyond Crypto
Beyond regulating cryptocurrencies, Grewal oversaw a wide range of enforcement initiatives at the SEC.
He approved more than 2,400 enforcement actions that resulted in fines, disgorgement, and prejudgment interest totaling more than $20 billion, significantly bolstering the agency’s financial standing.
Additionally, over $1 billion was awarded through the whistleblower program during his time as director.
Future of Crypto Regulation at the SEC
The crypto community was abuzz with speculation following Grewal’s departure about what it might mean going forward for U.S. cryptocurrency regulation.
Senior Counsel and Director of Global Regulatory Matters at Consensys Bill Hughes played down any link between Grewal’s resignation and the current discussions about cryptocurrencies.
Just two days after the SEC’s fiscal year ended, Hughes hypothesized that the timing indicates Grewal is taking a break before moving into a private sector position.
“Sometimes you know when you are going to exit so you can take some time off before starting your big fancy new private sector job come 2025,” Hughes said.
In the upcoming years, Gensler, a well-known skeptic of cryptocurrencies, whose term is scheduled to end on June 5, 2026, will continue to influence the SEC’s stance on cryptocurrency regulation.