In a move signaling heightened scrutiny of cryptocurrency regulation, Representative Maxine Waters, the leading Democrat on the House Financial Services Committee, is demanding an oversight hearing to examine the Securities and Exchange Commission's (SEC) approach to the digital asset market. Waters has formally requested that the committee's Republican Chairman, French Hill, convene a hearing with SEC Chairman Paul Atkins to address concerns about the agency's recent actions regarding crypto.
Waters' call for a hearing comes amidst growing concerns about the SEC's handling of crypto-related enforcement actions. She has specifically criticized the SEC's decision to terminate or stay major enforcement actions against several prominent crypto companies and individuals, including Coinbase, Binance, and Justin Sun, who have been accused of significant violations of securities laws. Waters argues that the committee has not adequately scrutinized the SEC's rationale for abandoning these cases or how the agency intends to deter fraud and manipulation in the crypto markets, potentially impacting millions of retail investors.
In a letter to Chairman Hill, Waters voiced concerns that some companies involved in the SEC cases announced the terminations before the commission officially voted on them. She also contended that Chairman Atkins' office took an unusually active role in negotiating an end to these cases. Waters suggests that these policy shifts have been implemented through staff statements rather than formal rule-making, potentially circumventing administrative procedures.
Waters has emphasized the importance of the committee's responsibility to oversee the SEC, particularly its enforcement of securities laws and its impact on investor protection, market efficiency, and competition. She highlighted that since Chairman Atkins assumed his position, no oversight hearing has been held, despite the SEC's significant policy changes that have raised concerns about the politicization of its decision-making. Waters stated that robust oversight is essential to ensure the SEC is enforcing the law as intended to protect investors and promote market efficiency and competition. She also noted that during her tenure as Chairwoman, the committee held two hearings with Chair Gensler within his first year.
Waters also criticized Atkins for allegedly framing the agency's agenda as an instrument of the administration. Waters' criticism aligns with a broader debate about the appropriate level of regulation for the crypto industry and the SEC's role in protecting investors without stifling innovation.
This demand for an oversight hearing coincides with a period of potential change in the House of Representatives, with Democrats favored to regain the majority in 2026. If the Democrats do regain control, Waters may return as chair of the House Financial Services Committee, potentially leading to renewed congressional oversight of digital asset laws.
