The United States Senate Banking Committee has canceled a markup session scheduled for December 18 to consider the nomination of Caroline Crenshaw for a second term at the Securities and Exchange Commission (SEC). This move significantly reduces the likelihood that Democratic senators will confirm Crenshaw’s nomination before Republicans take control of the chamber in January.

Background on Caroline Crenshaw

Caroline Crenshaw, who served as an SEC commissioner under both Donald Trump and President Joe Biden, has a term ending in June 2024. However, she is permitted to continue her role at the SEC for 18 months after her term expires, extending her tenure until December 2025.

Crenshaw’s Nomination Faces Opposition

Crypto interest groups have been vocal in their opposition to Crenshaw’s nomination, claiming that she was "more anti-crypto" than SEC Chair Gary Gensler. This stance is supported by more than 40 organizations, which have asked senators to support her nomination. Interestingly, the groups also suggest that Trump was unlikely to appoint any Democratic SEC commissioners while in office.

Trump’s Pledge to Reorient the SEC

During his presidential campaign, Donald Trump promised to reorient the SEC and its regulatory approach to crypto. He pledged to fire Gensler "on day one" if elected and suggested that crypto users would be happier with an SEC under his administration. This pledge was seen as a significant campaign promise to the industry.

The Current State of the SEC

Crenshaw is currently one of three Democrats at the SEC, alongside Chair Gensler and Commissioner Jaime Lizárraga. Both Gensler and Lizárraga will leave the commission in January before their terms officially end. It remains unclear whether Senate Republicans will consider Crenshaw’s nomination once they have a majority in the chamber starting on January 3.

Possible Scenarios for Crenshaw’s Nomination

If confirmed, Crenshaw could serve at the SEC until 2029. However, if she is not confirmed, it is likely that she would be replaced before 2026 or her seat left vacant. Trump has announced his intention to nominate former SEC Commissioner Paul Atkins to take Gensler’s place once he takes office in January. Additionally, Trump has appointed an "AI and crypto czar": former PayPal chief operating officer David Sacks.

What Does This Mean for the Crypto Industry?

The cancelation of the markup session and the opposition to Crenshaw’s nomination could have significant implications for the crypto industry. If Crenshaw is not confirmed, it may signal a shift in the SEC’s regulatory approach to crypto under Trump’s administration. The appointment of an "AI and crypto czar" suggests that Trump is committed to addressing the industry’s concerns.

A Bipartisan SEC Under Trump?

It remains unclear whether Senate Republicans will consider Crenshaw’s nomination once they have a majority in the chamber starting on January 3. If Trump chooses not to nominate her, it could be seen as a significant departure from his campaign promises to the crypto industry.

Conclusion

The cancelation of the markup session and the opposition to Crenshaw’s nomination raise questions about the future of the SEC under Trump’s administration. The appointment of an "AI and crypto czar" suggests that Trump is committed to addressing the industry’s concerns. However, the outcome of Crenshaw’s nomination remains uncertain, and it will be interesting to see how this situation unfolds.

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