In summary
- Gary Gensler’s days as chairman of the Securities and Exchange Commission (SEC) are likely numbered, whether through firing or resignation.
- President-elect Donald Trump promised to fire Gensler on the first day of his term, although he legally cannot do so without cause.
- Gensler’s possible replacements include Hester Peirce, Mark Uyeda, Dan Gallagher, Chris Giancarlo and Brian Brooks.
Will he be fired? Or will he resign? Either way, Cryptocurrency industry antagonist Gary Gensler’s days as chairman of the Securities and Exchange Commission are likely numbered.
President-elect Donald Trump is set to reaffirm one of his most popular cryptocurrency promises made earlier this year. At least, that’s what many in the industry hope.
“I will fire Gary Gensler on day one,” Trump declared at a Bitcoin conference in July, drawing thunderous applause from thousands in Nashville. “The day I am sworn in, Joe Biden and Kamala Harris’ anti-crypto crusade will be over.”
Regardless of the fact that Trump’s words go against Supreme Court precedent—as Decrypt has reported, a president cannot fire an SEC chairman without cause—the names of several potential replacements for Gensler are circulating ahead of Trump’s inauguration on January 20.
That list includes Hester Peirce and Mark Uyeda, both SEC commissioners; Dan Gallagher, chief counsel for Robinhood; former US Commodity Futures Trading Commission Chairman Chris Giancarlo; and former Binance.US CEO Brian Brooks.
Appointed by President Joe Biden, Gensler’s term as president does not end until 2026, with 18 months left after his expiration date.
However, SEC chairmen have historically resigned when an opposing political party assumes control of the White House. Still, Gensler, a Democrat, could be immediately demoted from chairman to commissioner by Trump, leaving someone else to take over.
John Stark, a staunch cryptocurrency skeptic who once served as an SEC compliance attorney, argued Peirce’s case on Thursday.
“Most of the time, they just quit because they know a new president is going to be appointed,” Stark said. “Then the president will immediately appoint someone to be acting president, and it will usually be the most senior member of that party.”
Nicknamed “Crypto Mom” for her support of the industry, Peirce has taken issue with the SEC’s trend of suing cryptocurrency companies since she was appointed in 2018. Dissenting against an enforcement action focused on NFTs in September, she criticized the SEC’s approach as “wrong and excessive,” creating many unnecessary cases.
Of the five current SEC commissioners, three are from the Democratic Party, including Gensler. Meanwhile, Peirce’s Republican colleague Uyeda, who was appointed in 2022, is also being considered as a possible contender.
“I would give Uyeda good odds,” Jake Chervinsky, Variant Fund’s senior legal director, said in a tweet Wednesday, adding that he believes Peirce doesn’t want the job. However, he warned: “I hope Trump may prefer to bring in someone new he trusts.”
Peirce did not immediately respond to a request for comment from Decrypt.
With Trump’s transition team co-chaired by Cantor Fitzgerald Chairman and CEO Howard Lutnick, an outside pick to lead the SEC appears possible Fitzgerald believes Wall Street is poised to fill key Cabinet positions, POLITICO reported Wednesday.
Robinhood Chief Legal Officer Gallagher would be a “natural choice,” according to a former SEC official who spoke to POLITICO.
Previously serving as SEC commissioner from 2011 to 2015, Gallagher testified before Congress earlier this year about digital asset regulation and the lack of “regulatory clarity at the federal level.”
After pumping more than $119 million into this year’s federal election, some cryptocurrency company leaders are making calls of their own to replace Gensler. Ripple Labs CEO Brad Garlinghouse encouraged Trump to name Gallagher as SEC chairman on Wednesday, as well as Brooks or Giancarlo.
“They would be massive improvements in rebuilding the rule of law (and reputation) in the SEC,” Garlinghouse said. “Fire Gensler. Day 1, no delays.”
Nicknamed “Crypto Dad” for his commitment to digital assets as chairman of the US Commodity Futures Trading Commission (CFTC) from 2017 to 2019, Giancarlo now works as senior advisor and co-chair of the practice of Willkie Digital Works.
While Giancarlo was leading the CFTC, bitcoin futures were approved on the Chicago Mercantile Exchange. At the same time, he cultivated a “Do No Harm” approach to the digital asset industry, according to the conservative legal group Federalist Society.
Brooks, who has yet to earn a paternalistic nickname from the digital asset industry, primarily served as acting comptroller of the currency. Heading the independent arm of the U.S. Treasury Department, he was responsible for chartering, regulating, and supervising national banks.
From 2018 to 2020, Brooks served as chief legal officer of cryptocurrency exchange Coinbase. After departing Washington, he also served as CEO of Binance.US, leaving the US company after four months due to “differences over strategic direction.”
Notably, Coinbase and Binance.US, along with Binance and the platform’s co-founder and former CEO Changpeng Zhao, face ongoing SEC lawsuits, which allege that both companies violated their regulatory rules.
But with a change in SEC leadership led by Trump, Stark, the former SEC official, said a change in the agency’s stance would be almost certain.
“Does this mean the SEC’s war on cryptocurrencies is over?” he asked Thursday. “I would say ‘absolutely’, with a resounding ‘yes’.”
Edited by Sebastian Sinclair and Josh Quittner
Daily Debrief Newsletter
Start every day with the top news stories right now, plus original features, a podcast, videos and more.
Crypto Keynote USA
For the Latest Crypto News, Follow ©KeynoteUSA on Twitter Or Google News.
