A second Democratic commissioner at the Securities and Exchange Commission has announced their resignation, following Chair Gary Gensler's decision to step down, thereby allowing Republicans to take control of the agency as early as February. Commissioner Jaime Lizárraga will be leaving on January 17, citing family health reasons, which could expedite the redirection of the regulator's policies, including those related to cryptocurrency. Caroline Crenshaw will be the sole remaining Democrat on the five-member commission, whose term has already expired, and is currently serving an extended period that could last up to 18 months.
The commission, previously led by Gensler, has been at the forefront of enforcing regulations against crypto companies, arguing that digital asset platforms like Coinbase and Binance are operating as unregistered securities exchanges, and that many tokens traded on these platforms are indeed securities. With Gensler's resignation and Lizárraga's departure, the agency's stance on crypto is likely to undergo significant changes.
If President-elect Donald Trump appoints a Republican commissioner as acting chair, the new leadership can begin shifting policy priorities, potentially altering the agency's legal stance on crypto. The two Republican commissioners, potentially joined by a new acting chair, will dictate the agency's agenda while the remaining commission seats are filled by Trump's nominations. Gensler praised Lizárraga for his dedication to protecting investors and promoting fair markets, stating that he has been a valuable partner in their work to ensure markets work for both investors and issuers alike.