The Supreme Court has restricted the ability of the SEC to enforce anti-fraud laws and level civil penalties against violators. The decision is a huge deal for US crypto firms and changes the way that crypto and Web3 are regulated.
Joshua Simmons, partner at Wiley Rein and adjunct professor at the University of Virginia School of Law, called the ruling a “game changer” for the crypto industry. “The decision takes away the deference that agencies had,” Simmons said in response to Cointelegraph. Previously, the SEC had an iron fist in decisions regarding cryptocurrencies and Web3. The regulator imposed strict enforcement on firms like Ripple Labs, Binance, and more. Now, that power has been dramatically weakened.
Furthermore, the United States Supreme Court’s Loper Bright vs. Raimondo decision a few weeks ago also changed the way that crypto is regulated. Due to the 6-3 decision, US courts will no longer be able to “defer” to federal agencies when interpreting ambiguous statutes.
Also Read: Ethereum ETF Inflows Could Hit $10B, Sending Ether to New ATH
The decisions made by the Supreme Court may also impact the way Congress handles crypto and Web3 reform. The industry has faced significant challenges when facing the SEC and government agencies.
The government had argued that Congress expressly gave the SEC power to bring administrative proceedings and levy fines outside of a judicial process. Furthermore, The decision will reduce the commission’s leverage to extract high-dollar settlements.