Enforcement activity at the U.S. Securities and Exchange Commission (SEC) has fallen sharply under Chair Paul Atkins, with total actions against public companies and their subsidiaries dropping about 30% in fiscal year 2025 compared with the final year of former Chair Gary Gensler, according to a new report from Cornerstone Research.The decline aligns with historical patterns seen whenever SEC leadership changes, but analysts note it also reflects the agency’s shift in regulatory philosophy — particularly around digital assets.A Sharp Drop in Enforcement CasesCornerstone’s report, released Wednesday, found:30% fewer enforcement actions under Chair Atkins in FY2025Decreases across categories including issuer reporting, accounting, disclosure failures, and corporate governanceMarked reduction in crypto-related actions compared with the Gensler eraAlthough the SEC dropped several high-profile crypto investigations after Gensler’s departure, Cornerstone noted that the report itself referenced only one case explicitly — the dismissal of the SEC’s lawsuit against Coinbase in February.The reduction comes after the agency spent 43 days operating with limited staff during the federal government shutdown, which slowed reviews, investigations, and litigation.Shift in SEC Priorities Under AtkinsCornerstone said the new numbers are “consistent with the stated priorities of the current SEC administration.”Chair Paul Atkins has signaled repeatedly that his top priority is building a “rational, coherent, and principled approach” to regulating digital assets. His stance contrasts with Gensler’s more aggressive interpretations of securities laws and extensive crypto enforcement posture.The SEC’s Division of Examinations released its FY2026 examination priorities earlier this week — notably omitting any mention of crypto or digital assets, another sign of the agency’s shift away from the crypto-heavy focus of the Gensler period.Despite the decline in enforcement activity, Atkins said recently that the SEC under his leadership will not be “lax”, particularly in cases involving fraud or market manipulation — including in digital asset markets, should Congress grant additional authority.Shutdown Slowed Enforcement and OversightThe 43-day government shutdown had a clear effect on the SEC’s operations:Enforcement teams were unable to pursue investigations at full capacityStaff shortages delayed routine oversightProgress on pending crypto and non-crypto cases slowedReviews of ETF applications and IPO filings were pushed backFollowing the restoration of normal operations last week, the SEC has resumed processing IPO applications, ETF reviews, and a backlog of rulemaking tasks.Congress Eyes Digital Asset Market Structure ReformMeanwhile, lawmakers are preparing for significant shifts in U.S. crypto regulation.Republican members of the Senate Banking Committee said this week they expect to pass a comprehensive digital-asset market-structure bill by early 2026.The legislation had originally been expected before year-end, but progress was derailed by:The government shutdownPushback from Senate Democrats over DeFi-related provisionsIf enacted, the bill could dramatically reshape U.S. crypto oversight, granting the Commodity Futures Trading Commission (CFTC) expanded authority over digital assets and clarifying the SEC’s jurisdiction.Atkins has said the SEC will enforce securities laws firmly but consistently if the agency is given clearer authority over digital-asset markets.OutlookThe SEC’s enforcement decline reflects:Leadership transitionShifting prioritiesOperational limits during the shutdownPending legislative changes in CongressBut the respite for crypto firms may be temporary.If Congress passes a sweeping market-structure bill in early 2026, both the SEC and CFTC may soon be navigating a new era of coordinated digital-asset regulation — one where enforcement actions could rise again under revised statutory mandates.
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