The Securities and Exchange Commission (SEC) is experiencing a sweeping transformation under interim chairman Mark Uyeda, who has implemented significant policy changes before President Donald Trump's nominee Paul Atkins is confirmed, according to Bloomberg.

Acting SEC Chief Remakes Agency Before Trump Nominee Takes Helm

In less than two months as acting SEC chief, Uyeda has orchestrated a dramatic shift in the agency's regulatory approach, particularly regarding cryptocurrencies. His first public move came within a day of taking the interim position in January, when he initiated a revamp of the SEC's cryptocurrency policies.

"You have businesses to run, you don't exist to respond to SEC proposals," Uyeda told chief financial officers at a recent conference, signaling the agency's new direction. His remarks reflect the SEC's return to what he describes as its "narrow mission to facilitate capital formation, while protecting investors and maintaining fair, orderly and efficient markets."

The regulatory changes have been swift and substantial. The SEC has dropped more than 10 high-profile crypto-enforcement cases, extended compliance deadlines for three new rules, declared most memecoins exempt from securities laws, and terminated litigation related to climate-reporting regulations.

"There has never been anything this dramatic or far-reaching as what you're seeing now," Joel Seligman, a law professor at the University of Washington in St. Louis and SEC historian, told Bloomberg.

Staffing Overhaul and White House Directives

The transformation extends beyond policy changes to include significant staffing adjustments. The agency has offered early retirement incentives and plans to eliminate leases for certain regional offices. According to Bloomberg, the SEC has also decided to cut senior-most positions across regional offices, though current position holders aren't being forced out.

These changes, coupled with directives from the White House and the new Department of Government Efficiency (DOGE), have reportedly created an atmosphere of uncertainty within the agency. Bloomberg reports that staff anxiety is high and morale is low, with many employees actively seeking new positions.

Five academics, including Seligman, expressed concern in a public letter this month about the direction of the SEC. "With growing concern, we fear that we are watching the SEC face a death by 1,000 cuts," they wrote. "The end result might be a shell of a former self, as the SEC becomes an agency with little power, capacity or independent judgement."

Business Community Sees Opportunity

The business community has been quick to respond to the regulatory shift. The Managed Funds Association submitted a 13-page letter outlining business-friendly policy recommendations, while SIFMA, representing broker-dealers and financial services firms, urged the SEC to pause fee collections related to the Consolidated Audit Trail.

The SEC has already implemented changes aligned with some of these requests. In February, the regulator exempted personally identifiable information from CAT storage requirements and extended compliance deadlines for several rules, including those related to Treasury trade clearing and short-position reporting.

Atkins Awaits

While Uyeda serves as interim chairman, Trump's nominee Paul Atkins, who previously served as SEC commissioner from 2002 to 2008, awaits confirmation. According to Bloomberg, the Senate Banking Committee is looking to hold Atkins's confirmation hearing on March 27, though he has yet to file his final financial disclosures.

While regulatory priority shifts are normal during leadership transitions, the current changes are distinguished by their scope and the influence of White House directives.

"From a policy perspective, much of this was expected," Kimberly Hamm, a partner at Mayer Brown and former chief counsel to ex-SEC Chair Jay Clayton, told Bloomberg. "But the backdrop of the rapid-fire executive orders and federal workforce changes is what makes this challenging."

Source: Finance Magnates