SEC’s Uyeda Says Dropping Crypto Cases Helps Protect Agency Credibility

SEC Commissioner Mark Uyeda said the agency dropped some crypto lawsuits partly to protect its credibility, arguing that regulators should not defend legal positions they expect to abandon.

Speaking on Sept. 23, Uyeda said continuing to defend those positions in court could weaken confidence in the agency if its legal interpretation later changes. His comments were reported by Eleanor Terrett, host of the U.S. podcast Crypto in America.

SEC Moves Toward Rulemaking

Uyeda described the change as a “180-degree shift” in how the SEC handles crypto-related legal questions. He has previously criticized the agency’s reliance on enforcement actions, arguing that clearer rules should address issues affecting the industry.

Related: Ripple’s David Schwartz Links SEC Experience to Glock’s Connecticut Lawsuit

The SEC has recently moved toward rulemaking and temporary regulatory relief for parts of the crypto market.

Innovation Exemption Tests Tokenized Stocks

Uyeda described the SEC’s Innovation Exemption as “a kind of pilot.” The temporary framework allows certain onchain venues to trade tokenized U.S. stocks under specific conditions.

The SEC said the exemption will allow the agency to observe how these markets operate while considering longer-term rules. The commission has also requested public feedback on the framework.

Related: Russia to Let Market Shape Crypto Rules as Licensing Deadline Nears