SEC’s Caroline Crenshaw faces intense opposition ahead of Senate vote

Source: Crypto Briefing

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The Senate Banking, Housing and Urban Affairs Committee is set to decide on the reappointment of Caroline Crenshaw as SEC commissioner tomorrow. Crenshaw’s renomination, however, faces intense opposition from the crypto industry due to her perceived anti-crypto stance.

The Digital Chamber, an American advocacy group focused on promoting blockchain technology and digital asset industry, has publicly urged the Senate Banking Committee to reject the nomination of SEC Commissioner Caroline Crenshaw for a second term.

In a Dec. 12 letter, the organization argues that Crenshaw’s tenure has been characterized by a negative and outdated view of the digital asset market, proven by her dissent on spot Bitcoin ETF approvals and her opposition to Grayscale’s Bitcoin ETF conversion.

The Digital Chamber calls for a replacement for Commissioner Crenshaw as they believe a new commissioner is needed to foster a more balanced and forward-thinking regulatory framework for the digital asset industry.

Crenshaw was appointed to the SEC in 2020 by former President Trump and has been renominated by President Biden for a second term. If confirmed by the Senate, her term would extend beyond the typical five-year period, possibly until June 2029.

Some Republicans say that Democrats are hastily advancing Crenshaw’s confirmation before they potentially lose their majority in the Senate in January. The vote is scheduled to take place at 9:45am EDT, just days before Congress is set to adjourn for the year.

Critics argue that the timing reflects a strategic push by Democrats to secure Crenshaw’s position at the SEC, maintaining a regulatory framework that they believe is necessary for overseeing the crypto sector.

As the key vote approaches, the crypto industry unites to challenge Crenshaw’s renomination. The Digital Chamber’s letter is part of a unified lobbying effort to directly oppose Crenshaw’s reappointment.

Industry figures, including Coinbase CEO Brian Armstrong, have publicly denounced Crenshaw’s record. Armstrong has labeled her a failure as an SEC commissioner and urged lawmakers to vote against her nomination.

A number of digital asset organizations, including the Blockchain Association and the DeFi Education Fund, have mobilized efforts to block her confirmation, arguing that her actions have undermined Congress’ mandate for sound crypto regulations.

The Cedar Innovation Foundation, a dark-money group backed by undisclosed crypto interests, has launched a digital ad campaign labeling Crenshaw “more extreme” than Gensler, citing her opposition to spot Bitcoin ETFs and her “petri dish” remark.

If all Democratic members of the Senate Banking Committee vote in favor of Crenshaw, they could secure enough votes to advance her nomination to the full Senate.

Although Crenshaw has support from Democratic senators, the intense lobbying against her and the shifting political landscape, which has seen several Senate seats flip to Republicans, create a challenging confirmation environment.

Caroline Crenshaw and Jaime Lizárraga are two SEC commissioners who voted against the approval of spot Bitcoin ETFs in January. In contrast, Gary Gensler, the current SEC Chairman often perceived as critical of the crypto industry, along with commissioners Hester Peirce and Mark Uyeda, supported the approval of these products.

Lizárraga will step down from the SEC on January 17, 2025, just three days before Gensler’s departure, leaving Caroline Crenshaw as the only Democrat on the commission.

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Author: Vivian Nguyen