New Report Reveals SEC Plans for Increased Enforcement and Regulatory Actions in 2024

The SEC’s Enforcement Approach in 2024

The United States Securities and Exchange Commission (SEC) is expected to “ramp up” its ruling-by-enforcement approach in 2024, according to Norton Rose Fulbright’s 2024 FinTech Outlook. The global law firm anticipates further enforcement and regulatory actions concerning US securities laws in the crypto space.

Continued Regulatory Pressure

The report highlights the SEC’s accelerated efforts to bring enforcement cases against cryptocurrency platforms, asserting that some tokens sold on these platforms constitute securities. The agency’s objective is to subject these markets to regulatory requirements related to broker-dealer and exchanges.

Norton Rose Fulbright’s analysis alludes to the SEC’s legal cases against prominent players in the crypto industry, including Coinbase, Celsius, Ripple, and Genesis. If the prediction is accurate, the SEC will persist with an assertive approach to digital asset regulation despite criticisms and scrutiny.

New Lawsuit Against SEC

In parallel, the SEC faces legal challenges, as the Crypto Freedom Alliance of Texas (CFAT) and crypto exchange startup Lejilex filed a lawsuit in Texas, accusing the agency of regulatory overreach. The litigation argues that the SEC’s attempt to extend its regulatory power to digital assets exceeds its statutory authority, creating uncertainty within the trillion-dollar industry.

Coinbase’s Legal Battle

Notably, Coinbase is currently embroiled in a dispute with the SEC, which accused the exchange of selling unregistered securities. Coinbase’s legal counsel is seeking a determination on whether the matter falls outside of the agency’s delegated authority. Despite these efforts, challenges remain, as demonstrated by the remarks during a January hearing by D.C. Judge Katherine Polk Failla, expressing concerns about restricting the SEC’s regulatory scope.