Recent Appointments at the SEC
The Securities and Exchange Commission (SEC) has recently made two significant appointments that could reshape its approach towards digital asset regulation. Effective July 8, Brian T. Daly will take on the role of Director of the Division of Investment Management, while Kurt Hohl is set to become the Chief Accountant starting July 7. These moves follow the appointment of Paul Atkins as Chairman of the SEC in April, reinforcing a leadership that many in the crypto sector view as more favorable to their interests.
Brian T. Daly’s Experience
Brian Daly comes into his new position with a wealth of experience, having spent decades in investment management law. His prior roles include senior positions at prominent law firms like Akin Gump and Schulte Roth & Zabel, as well as compliance leadership in renowned firms such as Millennium Partners and Raptor Capital. Observers believe Daly’s arrival may indicate a shift towards more industry-responsive regulation, particularly as traditional investment entities begin to explore digital assets more vigorously.
Daly himself has expressed enthusiasm for positioning regulations within the bounds of statutory authority while ensuring that compliance standards remain robust for investment advisers and management.
“Brian’s extensive knowledge of the investment landscape is invaluable,” noted Chairman Atkins.
With Daly’s background, it is anticipated that the SEC may adopt a more nuanced stance on products related to cryptocurrencies, such as exchange-traded funds (ETFs) that track Ethereum or Bitcoin.
Kurt Hohl’s Role
In conjunction with Daly, Kurt Hohl’s return to the SEC is significant given his near 40 years of expertise in auditing, notably as a partner at Ernst & Young. Hohl’s mandate will be to enhance accounting standards and ensure transparency—imperative issues as crypto companies increasingly seek to comply with U.S. financial disclosure regulations or aim for public offerings.
Hohl previously served at the SEC in the 1990s, where he was instrumental in developing the Financial Reporting Manual, and his re-appointment signals a potential shift towards more stringent financial reporting requirements, especially for crypto-centric businesses engaged in IPOs or dealing with stablecoin regulations.
“As the landscape of capital markets changes rapidly, these appointments equip the SEC to better manage innovation while safeguarding investors,” said Chairman Atkins.
Changes in Regulatory Approach
In a notable shift under Atkins’ leadership, the SEC has also reconsidered its stance on several high-profile lawsuits against cryptocurrency firms. Earlier this year, lawsuits against platforms like Coinbase and Cumberland DRW were dropped, and an investigation into Uniswap Labs concluded without any enforcement action.
The SEC recently brought to a close its investigation of CyberKongz, a known NFT and gaming project on the Ethereum platform, also without pursuing any legal consequences. The agency further decided against taking action against Richard Schueler (Richard Heart), the founder of Hex, PulseChain, and PulseX, indicating a possible easing of the regulatory approach towards the crypto industry.
