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Industry heavyweights applauded the news that the agency’s enforcement chief, Gurbir Grewal, will be stepping down from his post on October 11.
During Grewal’s tenure, the SEC pursued more than 100 enforcement actions against crypto firms.
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Posted October 3, 2024 at 1:55 pm EST.
The SEC announced this week that its director of enforcement, Gubir Grewal, would be departing the agency on October 11, and the reaction on Crypto Twitter was fierce and swift.
“Don’t let the door hit you on the way out,” Alexander Grieve, the vice president of government affairs at VC firm Paradigm, quipped on X.
Grewal and his boss, SEC chair Gary Gensler, are wildly unpopular in the crypto world for their perceived hostility towards the industry.
During Grewal’s tenure, which began in June 2021, the SEC pursued more than 100 enforcement actions against crypto firms, including leading exchanges Binance, Kraken and Coinbase; XRP sponsor Ripple; and Metamask developer Consensys. In the case of Binance, the exchange ultimately entered a plea deal in which it paid $4.3 billion in fines to settle the SEC’s civil charges and the Department of Justice’s criminal charges.
Read more: SEC Appeals Ruling in Ripple Labs Lawsuit
“Director Grewal pursued a needless and arbitrary ‘regulation by enforcement’ strategy that has only created uncertainty and challenges for digital asset companies,” Representative French Hill (R-AR), often an advocate for the crypto industry, said on X.
Meanwhile, Jake Chervinsky, chief legal officer at crypto VC firm Variant, noted that Grewal’s departure is “perhaps the inevitable end to a campaign of unlawful harassment and misrepresentation resulting in many embarrassing defeats in court.” Among those defeats were Ripple being hit with just a $125 million fine for violating securities laws while the SEC sought a $2 billion penalty, though the SEC announced on Wednesday that it was appealing that decision. The SEC was also forced to approve spot bitcoin exchange-traded funds by a Washington D.C. appeals court earlier this year.
Some in the industry theorized about the significance of the timing of Grewal’s departure from the SEC.
Read more: Gary Gensler Reiterates in Speech That Coinbase, DeFi Should Be Defined as ‘Exchanges’
“9 days notice and no immediate replacement announced means one of a few things,” Adam Cochran, managing partner at activist venture capital firm Kinnaman Ventures, mused on X. “1) The writing is clearly on the wall that Gensler is out next term in either administration and senior people are jumping ship fast [or] 2) Gensler is taking heat for his bs from even his top supporters (Warren/Brown) and gave up a scape goat [sic].”
Former president Donald Trump has pledged to “fire” Gensler on “day one” if he is elected president, while Vice President Harris is facing pressure from crypto industry donors to do the same.
The SEC has not announced any immediate replacement for Grewal, instead saying in the press release that the Enforcement Division’s deputy director, Sanjay Wadha, will serve as “acting director,” and the Division’s chief counsel Sam Waldon will take on the role of “acting deputy director.”