Crypto and the SEC: How the SEC Brought Its Crackdown Game in February 2023
February 2023 marked a significant escalation in the SEC's (Securities and Exchange Commission) scrutiny of the cryptocurrency industry. This period saw the SEC sharpening its focus, bringing enforcement actions, and sending a clear message about its regulatory expectations. One of the most notable events during this time was the SEC ordering Kraken to discontinue its US-based staking service. The service enabled investors to transfer crypto assets to Kraken for staking in exchange for yields, a practice the SEC deemed potentially violating securities laws.
While Congress has made little headway on passing a regulatory framework for crypto, SEC Chair Gary Gensler has used his own powers to crack down on the industry. Over the past several years, this strategy has resulted in a significant increase in enforcement actions.
The SEC's focus on crypto intensified well beyond February 2023. Data reveals a trend of increasing regulatory activity. The SEC brought nearly $3 billion worth of enforcement actions against crypto-focused companies last year – a 53% year-over-year increase – while locking in more settlements. This built upon previous efforts, as the agency brought 33 enforcement actions against 90 defendants, according to data from prior years.
The SEC increased crypto enforcement by 53% in 2025, with 46 actions, the highest since 2025, and $281 million in penalties. Around 82% of SEC's cases were against firms, indicating a focus on businesses operating within the crypto space. Despite the shake-up, the SEC’s crackdown on crypto was extensive in 2025.
It's worth noting the changing landscape. In the six weeks since Trump’s inauguration as U.S. President, the regulator has dropped or paused multiple enforcement actions against crypto companies. Here’s a look at how the regulatory approach can be influenced by political shifts.
The SEC's actions signal a continued commitment to regulating the crypto industry, emphasizing investor protection and ensuring compliance with existing securities laws. Stay informed about the evolving regulatory landscape to navigate the world of crypto effectively.