The U.S. Securities and Exchange Commission (SEC) has outlined its priorities for 2025, placing cryptocurrency assets under the regulatory microscope. This reflects a growing concern about the risks that digital currencies pose to retail investors, and the SEC’s ongoing efforts to ensure transparency, compliance, and investor protection in this rapidly evolving sector.
As digital assets become an integral part of the financial landscape, the SEC’s role in enforcing regulatory standards and monitoring the conduct of investment advisors becomes ever more critical.
In its recent 2025 priorities report, the SEC stated that examinations will specifically focus on how registrants, such as investment advisors, understand and manage crypto assets.
The SEC aims to determine whether firms adhere to the fiduciary duties required when offering advice on these assets, especially in cases involving retail investors and retirement savings.
This emphasis on crypto stems from concerns about the complexity, volatility, and opaque nature of many digital assets. The SEC is particularly interested in scenarios where products are recommended to investors without sufficient explanation or understanding of the risks.
Firms managing crypto assets will be evaluated on their compliance with regulatory standards and transparency when advising clients.
Previous work by the SEC
Over the past decade, the SEC has maintained a controversial stance on cryptocurrency, with a combination of enforcement actions, rulemaking, and public statements. The Commission has both supported crypto companies and taken legal actions against several prominent firms. Below is a closer look at its actions:
The SEC has not only been a watchdog but also a facilitator of responsible innovation. Several initiatives have been geared toward clarifying regulations and supporting firms that comply with existing laws:
In 2021, the SEC approved the first Bitcoin futures ETFs (Exchange-Traded Funds) after years of debate. This opened the door for institutional investors to gain exposure to Bitcoin in a regulated framework.
The approval of these products, like those from ProShares and Valkyrie, signified a shift in the SEC’s approach, recognizing that the futures market could be an entry point for crypto investments under strict regulation.
The SEC has issued guidance for Initial Coin Offerings (ICOs) and token offerings, helping firms understand how to issue digital assets in compliance with securities laws. While this has been a contentious area, the guidance serves as a roadmap for firms aiming to stay within legal boundaries.
However, the SEC’s enforcement track record has been more aggressive. The agency has taken legal action against several high-profile crypto companies, often citing the sale of unregistered securities or failure to follow compliance procedures.
One of the most notable cases involved Ripple Labs, which the SEC sued in December 2020, claiming that Ripple’s sale of XRP tokens constituted an unregistered securities offering.
This lawsuit has been ongoing, with implications for how cryptocurrencies are classified—either as securities or commodities. The case is viewed as pivotal in defining the future regulatory environment for cryptocurrencies.
In February 2022, the SEC reached a $100 million settlement with BlockFi, a cryptocurrency lending platform. BlockFi was accused of failing to register its lending product, which the SEC deemed a security.
This was one of the largest penalties imposed by the SEC on a crypto firm, reinforcing the message that compliance with securities laws is essential for platforms offering yield-based crypto products.
The SEC has also investigated leading exchanges, such as Coinbase and Binance, for listing unregistered securities and potentially misleading customers about the safety and risk associated with certain digital tokens.
While these firms have made efforts to comply with U.S. regulations, the SEC has continued to scrutinize their operations, looking into issues around transparency, token listings, and conflicts of interest.
