Following Yesterday’s Development, Good News Came from the US Prosecutor to the Cryptocurrency Industry!

Following a series of landmark convictions, including that of FTX founder Sam Bankman-Fried, the U.S. Attorney’s Office for the Southern District of New York (SDNY) crypto para will reduce the focus on their crimes.

Scott Hartman, co-chair of the securities and commodities task force, announced the shift today, citing reduced resources devoted to crypto litigation.

“You won’t see a lot of crypto business coming out of SDNY in the future, at least,” Hartman said at the Practicing Law Institute conference in New York. While the office will continue to pursue cryptocurrency cases, it noted that fewer prosecutors are now working on those cases compared to after the “crypto winter” of 2022, when the collapse in digital asset prices exposed widespread fraud.

“We filed a lot of major lawsuits in the wake of the crypto winter,” Hartman added, citing the office’s important role in addressing fraud during the crisis. He noted that regulatory bodies such as the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) remain active in overseeing the industry.

The announcement comes a day after President-elect Donald Trump appointed former SEC Chairman Jay Clayton as U.S. Attorney for the SDNY, replacing Biden appointee Damian Williams.

Clayton, who served as SEC chairman from 2017 to 2021 during the Trump administration, had a relatively limited approach to regulating the nascent cryptocurrency industry during his tenure. In response, current SEC Chairman Gary Gensler took a more aggressive stance, prompting backlash from many cryptocurrency executives who supported Trump’s campaign.

The SEC, under Gensler, has taken numerous enforcement actions against crypto companies; This is a sharp departure from the Clayton era, when the industry was smaller and less scrutinized.

*This is not investment advice.