Former SEC Acting Chair Mark Uyeda: Dismissal of Lawsuits to Preserve Court Credibility
Mark Uyeda, a commissioner of the U.S. Securities and Exchange Commission (SEC) and acting chair from January to April 2025, publicly stated that the SEC's dismissal of a series of lawsuits against the crypto industry in early 2025 was aimed at preserving the agency's credibility in court before a major policy shift. This is the first time SEC leadership has publicly explained the internal considerations behind the mass dismissal of lawsuits at that time.
Uyeda made these remarks at a financial market quality conference hosted by the Psaros Center for Financial Markets and Policy at Georgetown University. He said, "I would not let our litigation lawyers stand in court while the Commission simultaneously issues a 180-degree turn in explanation." He meant that if the SEC was prepared to overturn its previous legal stance on crypto assets, continuing to defend the old position in court would lead to contradictions and credibility issues for the agency.
The dismissed cases included enforcement actions against Coinbase, Kraken, Ripple Labs, and other crypto companies. These cases were left over from the previous administration, with the core controversy being whether crypto tokens qualify as securities and whether trading platforms need to register as securities exchanges. During Uyeda's tenure as acting chair, the SEC initiated the mass dismissal; after he left, Paul Atkins took over as chair and continued this direction.
In hindsight, the dismissals cleared the way for subsequent regulatory shifts. On August 18, 2026, the SEC proposed the "Crypto Asset Regulatory Rules": startups could be exempt from raising up to $5 million within four years, with an additional exemption of up to $75 million every 12 months. On September 17, the SEC approved an "innovation exemption" for tokenized stocks, valid for five years after issuance, requiring tokenized stocks to grant holders the same voting and dividend rights as traditional stocks, and allowing trading on tokenized securities exchanges.
The internal dynamics of the SEC are also changing. Longtime crypto policy leader Hester Peirce will leave in November 2026; she has led the SEC's crypto working group since January 2025 and is a key figure in pushing for industry regulation. Uyeda's statement effectively rewrites the logic of the dismissals from "the cases themselves are untenable" to "the agency's position is about to change," directly responding to external doubts that the SEC's dismissals were politically motivated.
In market mechanisms, the direct beneficiaries of the dismissals are the defendant companies like Coinbase, Kraken, and Ripple: they have shed the costs of litigation and the uncertainties of securities registration, allowing them to expand their U.S. operations and launch new tokens. Funds have shifted from litigation preparation and compliance risk avoidance to issuing, listing, and creating tokenized products in the U.S. The tokenized stock exemption has led traditional brokers, exchanges, and crypto platforms to compete for the same market. The pressured parties are overseas platforms that rely on regulatory ambiguity and traditional financial institutions that previously invested heavily in compliance based on securities standards, whose first-mover advantage has been weakened.
Source: Public Information
ABAB AI Insight
The SEC's stance on crypto has oscillated over five years. During former Chair Gary Gensler's tenure, the SEC regulated the crypto industry through "enforcement instead of legislation," citing the Howey test established by the Supreme Court in 1946 to classify many tokens as securities, leading to lawsuits against major platforms like Coinbase, Binance, and Kraken, and issuing Wells notices to Uniswap, OpenSea, and Robinhood. In July 2023, Judge Analisa Torres ruled in the Ripple case that XRP's programmatic sales in the secondary market do not constitute a securities offering, marking a significant defeat for the SEC; in August 2024, the court fined Ripple approximately $125 million. After Trump took office in January 2025, the SEC rescinded Accounting Bulletin No. 121, which restricted banks from custodying crypto assets, established a crypto working group, and gradually dismissed lawsuits against Coinbase, Kraken, and Binance between February and May.
After the dismissals, policy resources concentrated on "rule-making." In July 2025, Trump signed the GENIUS Act on stablecoins; the same month, the House passed the CLARITY Act, defining the jurisdictional boundaries between the SEC and CFTC. Atkins then launched "Project Crypto," aiming to allow on-chain securities to be legally issued and traded in the U.S. Industry funds simultaneously shifted towards politics: during the 2024 election cycle, the crypto industry's super PAC Fairshake raised over $200 million, with Coinbase, Ripple, and a16z as major contributors. These political investments ultimately translated into dismissals and exemption rules.
A similar case is the regulatory pendulum after the 2008 financial crisis. The Dodd-Frank Act of 2010 significantly tightened bank regulations, while Congress passed legislation in 2018 easing stress testing requirements for mid-sized banks; subsequently, the collapse of Silicon Valley Bank in 2023 was widely seen as related to regulatory relaxation. Another analogy is the CFTC's abandonment of oversight of over-the-counter derivatives in the late 1990s, with the Commodity Futures Modernization Act of 2000 formally exempting OTC derivatives, ultimately leading to costs during the 2008 credit default swap crisis. Crypto regulation is currently transitioning from "enforcement confrontation" to "rule acceptance."
The essence is a change in regulation, driven by constraints of institutional credibility. The mechanism is that legal interpretations by administrative agencies have precedent effects; if the SEC argues in court that tokens are securities while simultaneously granting exemptions in rules, defendants can invoke the new rules to counter old charges, and judges will question the consistency of the agency's position, which could undermine the SEC's credibility in other non-crypto cases. In 2024, the Supreme Court overturned the Chevron deference principle in the Loper Bright case, no longer defaulting to respect administrative agencies' legal interpretations, making the consistency of agency positions even more critical. Thus, dismissals are not only a political choice but also a legal strategy: first retreat from the old battlefield, then redefine the industry with rules.
ABAB News · Cognitive Law
- Before changing the rules, first retreat from the old battlefield.
- Regulatory stances may change, but court records do not.
- Enforcement defines the industry, while rules price the industry.
A few notes:
- Title wording: Uyeda is still an SEC commissioner; "former acting chair" follows the original phrasing, with his current position clarified in the text.
- Unverified background: The content in the AI interpretation comes from publicly available English information I possess; this round has not been verified line by line online, and it is recommended to confirm again before publication:
- Specific dismissal dates for each case.
- The fine amount for Ripple.
- Fundraising figures for Fairshake.
- The Loper Bright case.