U.S. Court Halts Lawsuit Against SEC: New Leadership Brings Shift in Crypto Regulation

A major shift is underway in the U.S. crypto regulatory landscape. A federal court in Kentucky has officially paused legal proceedings brought against the Securities and Exchange Commission (SEC) by 18 Republican state attorneys general and the DeFi Education Fund.

🔹 New SEC Leadership Could Rethink the Case On April 16, Judge Gregory Van Tatenhove approved a 60-day stay in the case. This came after the SEC’s own statement in mid-March suggesting that the lawsuit could potentially be resolved following a leadership change at the agency. The new SEC Chairman, Paul Atkins — a well-known Wall Street advisor and crypto advocate — took over earlier this month, replacing acting chair Mark Uyeda and succeeding Gary Gensler, who had maintained a tough stance on the crypto industry.

🔹 GOP Attorneys General Push Back Against Gensler-Era SEC The lawsuit, filed in November, accused the SEC of overstepping its authority and aggressively targeting the crypto space. The attorneys general claimed that Gary Gensler’s SEC engaged in a massive federal overreach, without congressional approval. The plaintiffs include officials from Texas, Florida, Ohio, Kentucky, Tennessee, Wyoming, West Virginia, and other Republican-led states. According to the filing, the SEC attempted to seize regulatory power from the states through a string of enforcement actions aimed at crypto companies.

🔹 Crypto Wins Another Battle: IRS Broker Rule Overturned Meanwhile, on April 16, the DeFi Education Fund, Blockchain Association, and Texas Blockchain Council announced they were withdrawing their lawsuit against the IRS. The lawsuit, filed in December, challenged the so-called “broker rule”, which would have required DeFi protocols to report user transactions to the IRS. That fight ended in victory for the crypto industry after President Donald Trump signed a bill on April 11 officially repealing the rule.

🔹 SEC Begins to Soften: Lawsuits Against Crypto Firms on Hold This isn’t an isolated case — the newly led SEC has already paused or dropped several key lawsuits against crypto firms in 2025. All signs point to a friendlier, more collaborative approach to crypto regulation under Atkins’ leadership.

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