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Abstract

Donald Trump’s election as president during November 2024 results in perhaps the most dramatic philosophical change in approach to governmental regulation in over ninety years. The Great Depression of the 1930s created a need for regulatory reform and resulted in the advent of such new regulatory frameworks as the U.S. Securities and Exchange Commission (SEC). It has been the purpose of the SEC to create and nurture efficient securities markets enabling vibrant capital formation while preventing fraud upon the investing public. At issue is the contrast between the regulatory regime in place since 1933-34 and the Trump Administration’s desire to foster securities and capital markets having less regulation and enforcement. As Congress passes the GENIUS Act (stablecoin) legislation during the summer of 2025 it becomes clear that cryptocurrencies have a significant future in the United States. My focus here is the regulation of crypto currencies, protection of the investing public, and their impact on the soundness of capital markets and our financial system.

SEC Commissioner Caroline Crenshaw writes, “Over the last several months, we have heard repeatedly that the Commission, and its new Crypto Task Force, are embarking on a quest to give the crypto industry regulatory clarity. We’ve heard ‘change is coming fast’ for crypto at the SEC and that the crypto markets will soon be free from the “limbo” they’ve been ‘languishing […] in for years.’” She continues, “How is it that these crypto assets are supposedly not securities when it comes to registration requirements, but conveniently are securities when a registrant sees an opportunity to sell a new product?... If you’re confused, join the club. The various, and sometimes conflicting issues surrounding whether crypto constitutes “a security” and the appropriate regulation of this technology remains under considerable controversy. These issues are the subject of this paper.

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