Crypto Crackdowns Could Take Back Seat to Immigration Under Trump
Expect the U.S. government to scale back enforcement of the cryptocurrency sector under the new administration.
That was the message Friday (Nov. 15) from current and former senior government attorneys at a conference in New York hosted by the Practicing Law Institute, per a report by Reuters.
According to the report, those lawyers said that while the government will continue to pursue financial fraud cases, President Trump’s Justice Department would likely prioritize areas like immigration enforcement, one of the tentpoles of the new president’s campaign.
Scott Hartman, co-chief of the Securities and Commodities Task Force for the U.S. Attorney in Manhattan, said that office will allocate fewer resources to going after cryptocurrency crimes in the wake of landing a number of high-profile convictions, including that of FTX founder Sam Bankman-Fried.
Hartman told the conference that the office would not ignore crypto cases, but has fewer prosecutors devoted to them than it did during the “crypto winter,” a period in which the prices of digital assets plummeted.
“We brought a lot of big cases in the wake of the crypto winter — there were a lot of important fraud cases to bring there,” Hartman said. “But we know our regulatory partners are very active in this space, and we don’t have a lot of people.”
His comments came one day after Trump announced Jay Clayton, a former chair of the Securities and Exchange Commission (SEC), as his pick to become the new U.S. attorney in Manhattan.
Steve Peikin, who led SEC enforcement under Clayton, praised him as a “great choice” to lead the office, but said the Justice Department’s overall priorities could shift.
“There could be a reallocation of substantial resources to immigration enforcement,” said Peikin, now a partner at law firm Sullivan & Cromwell. “I would be surprised if that doesn’t happen.”
Trump’s victory earlier this month has been viewed as a win for the crypto sector. And as covered here last week, it has led the British government to develop new crypto legislation dealing with stablecoins, with plans to exclude staking services from existing financial regulation.
“The U.K. has a real opportunity to capitalize on a second-mover advantage, but only if it can mobilize,” said Laura Navaratnam, U.K. policy lead at the Crypto Council for Innovation, told Bloomberg News. “We are a little bit further than even the Treasury and the regulators would’ve ideally wanted.”
As Trump has promised to turn the U.S. into a crypto haven, Great Britain wants to seem more inviting to digital asset companies. That means measures such as an eventual consultation paper on stablecoins from the Financial Conduct Authority due early next year, followed by a phased approach to its regulation of other crypto assets.
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