Emre Yumlu 
Crypto policy returned to center stage in Washington this week during a House Financial Services Committee hearing, where SEC Chair Paul Atkins faced pointed questions about the agency’s recent enforcement record. Democratic lawmakers challenged what they described as a noticeable shift in regulatory posture toward the digital asset industry under President Donald Trump’s administration.
Representative Stephen Lynch of Massachusetts argued that enforcement activity has declined significantly since Trump took office and appointed Atkins to lead the Securities and Exchange Commission. According to Lynch, enforcement actions targeting the crypto sector have fallen by roughly 60%. He cited the SEC’s decision in May 2025 to move to dismiss its case against Binance as a prominent example of this trend.
Concerns Over Political and Foreign Ties
The hearing extended beyond enforcement statistics. Lawmakers also raised concerns about the Trump family’s connections to cryptocurrency ventures. Particular attention was given to World Liberty Financial (WLFI), a decentralized finance platform reportedly linked to the Trump family.
Recent reports indicate that Aryam Investment 1, an Abu Dhabi-based investment vehicle backed by Sheikh Tahnoon bin Zayed Al Nahyan, the United Arab Emirates’ national security adviser, acquired a 49% stake in the startup behind WLFI. Lynch suggested that such foreign involvement, combined with crypto projects associated with the Trump family, could present risks to both national security and investor confidence.
He also pointed to recent market volatility, noting that the crypto market has declined by approximately 25% over the past month. In his view, ongoing scams and weakened enforcement have damaged trust, harming consumers and the broader reputation of the industry.
SEC Pushes Back
Chair Atkins rejected the characterization that the agency has retreated from oversight. He maintained that the SEC continues to pursue a “robust” enforcement agenda and remains active in bringing cases where warranted.
However, Representative Maxine Waters of California questioned the motivations behind the dismissal of certain high-profile lawsuits. She argued that several cases were dropped despite prior legal momentum in court. Waters further alleged that crypto executives who benefited from pardons or withdrawn lawsuits had contributed millions of dollars to Trump and his family. She reiterated calls for scrutiny of the Trump family’s crypto ventures, suggesting they could serve as indirect channels for foreign influence over executive branch policy.
Political Stakes in an Election Year
The debate unfolds against the backdrop of a U.S. midterm election cycle. If Democrats regain control of at least one chamber of Congress, the trajectory of crypto market structure legislation could shift or slow considerably.
With regulatory policy, political power, and digital assets now closely intertwined, the future of U.S. crypto oversight appears increasingly shaped by electoral outcomes as much as by financial law.
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