he Securities and Exchange Commission and the Commodity Futures Trading Commission announced that they have agreed to work more closely and collaborate more on regulatory issues and enforcement. The agencies say the agreement, documented in a “memorandum of understanding,” will allow the agencies to better support lawful innovations, uphold market integrity, reduce regulatory overlap, and protect investors and customers.

The agreement is a formal, non-binding document that outlines a plan to collaborate between the two agencies, which also details roles, responsibilities, and goals without creating legally enforceable obligations.

“The MOU shows the agencies’ commitments to provide fair notice to market participants, respect individual liberty, and foster lawful innovation with the minimum amount of regulation to enhance U.S finance competitiveness,” the SEC says. The main intention was to resolve the conflict between the agencies and provide a framework of cooperation, particularly on cryptocurrencies and digital assets.

In conjunction with the MOU, the agencies have created what they are calling a “joint harmonization initiative” to advance coordinated oversight and promote regulatory clarity in areas of common regulatory interest. The initiative will support coordination across the policymaking, examination, and enforcement functions of each agency, particularly for joint applications and shared policy efforts, including:

• Clarifying product definitions through joint interpretations and rulemakings.
• Modernizing clearing, margin, and collateral frameworks.
• Reducing frictions for dually registered exchanges, trading venues, and intermediaries.
• Providing a fit-for-purpose regulatory framework for crypto assets and other emerging technologies.
• Streamlining regulatory reporting for trade data, funds, and intermediaries.
• Coordinating cross-market examinations, economic analyses, risk monitoring, surveillance, and enforcement.

“America’s financial markets are the envy of the world because they scale and adapt to meet investor demands. Like our markets, the CFTC’s and SEC’s regulatory frameworks must also evolve and modernize to accommodate the needs of our market participants,” said CFTC Chairman Michael Selig. “This Memorandum of Understanding solidifies the agencies’ commitment to harmonize regulatory frameworks to provide comprehensive and seamless financial market oversight. By working together, we’ll eliminate duplicative, burdensome rules and close gaps in regulation for the benefit of all Americans and usher in a golden age of American finance.” 

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he Securities and Exchange Commission’s director of the Enforcement Division, Margaret Ryan, stepped down this week after only a little more than half a year on the job. Sam Waldon, who served as head of enforcement before Ryan, will return to the role as acting director.

During her time in the office, Ryan oversaw what the SEC calls a “course correction” within the division, which it says enabled it to refocus on prioritizing cases that provide meaningful investor protection and strengthen market integrity, rather than technical rule violations with no charges of investor harm. She also allocated division staff toward addressing misconduct such as fraud, market manipulation, and abuses of trust, emphasizing holding individuals accountable for their wrongdoings, promoting stronger deterrence, and better safeguarding investors, according to the SEC.

“I extend my thanks to Chairman Atkins, the Commission, and the staff of the Enforcement Division for the opportunity to continue my public service in a different role,” said Ryan. “As I recently said, I did not seek the role of Director of the SEC’s Division of Enforcement. Rather, this role found me. And for that, I am grateful. I am confident that the foundation I helped to shape—working together with Chairman Atkins—will continue to serve investors and the markets well.”

Under Ryan, enforcement actions at the SEC reached multi-year lows in the 2025 fiscal year, following the leadership transition from SEC Chair Gary Gensler to Paul Atkins. The SEC filed 313 new enforcement actions in 2025, a 27 percent decrease from fiscal year 2024 and the lowest in a decade. Actions against public companies and subsidiaries dropped 30 percent from 2024, with 93 percent of the year’s total actions initiated during the first quarter under Gensler.

Only four actions against public companies were initiated after January 2025 under the new administration, the lowest since 2013. Total monetary settlements for public companies declined by 45 percent, the lowest since 2012. Additionally, the SEC initiated only 10 accounting and auditing actions, a 68 percent decrease from 2024. The main reasons for the decline include leadership changes, new strategies, staffing adjustments, reorganization, and case dismissals. Despite the overall decrease, the SEC says Atkins is prioritizing retail investor protection, cross-border fraud, AI washing, and insider trading. 

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Atkins published a few initial potential questions to be raised at the roundtable in determining whether the CEO compensation rules are not only cost-effective but also necessary for the purpose of providing information that will enable investors to make informed investment decisions.

“While it is undisputed that these requirements, and the resulting disclosure, have become increasingly complex and lengthy, it is less clear if the increased complexity and length have provided investors with additional information that is material to their investment and voting decisions,” Atkins said in a statement.

Among Atkins proposed questions, was the chair’s inquiry into the “pay-versus-performance” and “bonus claw back” rules that were recently adopted by the SEC in 2022. The “pay-versus-performance” rule ultimately requires public companies to disclose in a clear manner the relationship between the executive compensation actually paid by the company and the financial performance of the company itself. Meanwhile, the “bonus claw back” rules originally require companies to adopt policies that require executive officers to pay back incentive-based compensation that they were awarded erroneously.

This announcement comes at a time when the agency has demonstrated a shift toward reducing regulatory enforcement, in line with the priorities set by the Trump administration “The SEC, in its regulatory capacity, is tasked to balance investor protection with promoting capital formation and market efficiency,” according to Atkins. “In years past, the commission has unfortunately demonstrated a tendency to prioritize regulatory expansion over meticulous economic analysis, potentially jeopardizing this delicate balance.”

Since President Trump took office, the SEC has largely ceased pursuing high-profile cases against companies within its jurisdiction and has released staff-level statements suggesting that meme coins and certain crypto mining activities fall outside its regulatory scope.

Regulatory Rollbacks Draw Criticism

While many are in support of deregulation, many have expressed their opposition to it. SEC Commissioner, Caroline Crenshaw, believes that such deregulation may pave a path for a crisis similar to the financial crisis that occurred in 2008. It feels all too familiar to those of us who have lived through 2008,” Crenshaw warned, quoting a report from an independent commission that found that the 2008 crisis was preventable and that “the public stewards of our financial system ignored warnings and failed to question, understand, and manage evolving risks.”

“After a crisis happens, the first thing people ask is, ‘How could this have happened?’ And, more specifically, ‘Where were the regulators?” Crenshaw said. “But before a crisis happens, everyone demands that regulators get out of their way. I don’t want us to suffer the same fate.”

While Atkins has yet to respond to such comments, it is almost certain the agency will address such issues at its incoming roundtable meeting. The roundtable will be open to the public and held at the SEC’s headquarters. The discussion will be streamed live on the SEC website and a recording will be posted at a later date.

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According to the bill, the CFPB’s budget would take a big hit as well as its penalty money obtained from enforcement actions. The funds received from these enforcement actions will be used for victim compensation with the leftovers being sent to the Treasury. Specifically, the legislation will require that “if the Bureau makes payments to all of the direct victims of activities for which that civil penalty was imposed, the Bureau shall transfer all amounts that remain in the Civil Penalty Fund with respect to that civil penalty to the general fund of the Treasury.”

Essentially, the CFPB’s budget would decrease around 60% and its funding from the Federal Reserve would be capped at 5% of the central bank’s operating expenses under the proposal — down from the current limit of 12% as laid out in the Dodd-Frank Act.

The Legislation Represents Larger Effort to Cut Government Spending

The CFPB has come under a significant amount of fire since the start of the Trump administration. There have been many efforts by President Trump to dismantle the agency such as attempted mass firings, an order to suspend agency operations, and so on.

This legislation represents a broader effort by Republicans to create at least $1.5 trillion in spending cuts in order to pass a $5 trillion tax cut as part of President Trump’s policy agenda. “For too long, government spending has been on a one-way ratchet,” House Financial Services Committee Chairman French Hill, R-Ark., said at the start of Wednesday’s markup. “We are here with one purpose, to do our part to put our nation back on a responsible fiscal trajectory.”

Republicans are in support of this funding as they see it as a means towards diminishing “reckless government spending.” Meanwhile Democrats perceive the bill as hypocritical in that such substantial spending cuts themselves are “reckless.” Accordingly, many Democrats believe that the CFPB runs a profitable business, putting more money in consumer pockets than the expenses it incurs to do so.

PCAOB to be Dissolved Into the SEC

Under the proposed legislation, the PCAOB, known to oversee the audits of public companies, will merge into the SEC. This results from Republican criticism of the agency that it lacks accountability and transparency. The SEC would essentially assume the duties and responsibilities of the PCAOB.

While many are in support of such a significant move, many believe that such a move is not practical. Congresswoman Janelle Bynum cautioned against merging the PCAOB into the SEC, describing the proposal as a significant and potentially risky shift that demands closer examination. She urged Republicans to “pump the brakes” and introduced an amendment that would delay the transfer of oversight authority until the SEC can confirm that the change would not heighten investor risk.

In contrast, many believe that that such a move is crucial towards President Trump’s government spending agenda. “I appreciate my colleague’s newfound passion for fiscal discipline,” Congresswoman Ann Wagner said. “However, the committee print before us today is a result of extensive member input to deliver on the promise to rein in out-of-control spending.  

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The draft provides clearer guidance on when a digital asset falls under the jurisdiction of the SEC, the CFTC, or both. Essentially, the draft would grant power and funding to the CFTC and require firms to register with the it as well. The SEC, on the other hand, would retain oversight over securities and specific hybrid assets. It will also have the authority to oversee digital commodity activities by SEC-registered broker-dealers and exchanges, even though the  firms will be required to register the activity with the CFTC as well.

In addition to allocating oversight authority to the SEC and CFTC, the draft also provides key crypto definitions such as definitions for “digital commodity,” “blockchain system,” and “stablecoins.” In fact, it explicitly excludes digital commodities and payment stablecoins from the definitions of a security.

This draft represents a longstanding effort by the Republican Party to regulate digital assets. According to many, the digital assets market is in need of regulation as it is unstable and dangerous without such.  “We made historic progress in the 118th Congress to build bipartisan, bicameral consensus in crafting a functional regulatory framework for digital assets,” House Financial Services Committee Chair French Hill said. “Our discussion draft builds upon that work and provides much-needed regulatory clarity for the digital asset ecosystem by protecting consumers and safeguarding the long-term integrity of digital asset markets in the United States.”

Congress in Disagreement as to how Crypto Should be Regulated

Although many are in support of such regulations, many are skeptical of how exactly it will be regulated and whether this bill represents the most efficient and effective way of doing so. Congresswoman Maxine Waters announced that she intends to block the draft as she is concerned with conflicts of interest that may arise from the Trump family crypto investments.

Other senators, such as Ruben Gallego said that he understands the need to regulate digital assets but yet finds issue with how the bill itself addresses such a use. “[T]he bill as it currently stands still has numerous issues that must be addressed, including adding stronger provisions on anti-money laundering, foreign issuers, national security, preserving the safety and soundness of our financial system, and accountability for those who don’t meet the act’s requirement,” a group of Democratic Senators led by Gallego said. Although they are against the bill’s current version, they are “eager to continue working with our colleagues to address these issues.”

While both the Democratic and Republican parties are in agreement that the digital asset market should be a regulated one, the parties are in some sort of disagreement as to how exactly it should be regulated. Additional hearings are scheduled to take place to hear each side’s views on the matter.  

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Atkins, confirmed by a 52–44 vote, is expected to ease regulatory enforcement and roll back compliance requirements for corporations. Atkins’ anticipated intentions are expected to differ greatly to that of his predecessor, Gary Gensler, who was known for his pro-regulatory policies. Although Gensler instituted regulations aimed at restricting company actions and increasing regulatory requirements, the SEC underwent major changes since his departure in January.

Following Gensler’s departure as SEC Chair, then-Acting Chair Mark Uyeda signaled a less regulation-heavy approach. Under his leadership, the SEC dropped ten major crypto enforcement cases and extended compliance deadlines for rules implemented during Gensler’s tenure.

Many anticipate that Atkins will follow in Uyeda’s footsteps, adopting a more reserved approach to regulatory enforcement, including in the crypto space. “To look at what Chair Atkins’ priorities might be, I’ve been really focused on what acting Chair Uyeda and Commissioner Hester Peirce have been doing,” an attorney at Morrison Foersterr said, noting that both Uyeda and Peirce acted as counsel to Atkins during his time as SEC commissioner.

Atkins’ Confirmation Draws Mixed Reactions

While many have pointed out Atkins’ intention to lower regulatory enforcement, many believe that doing so merely represents his preference for “Wall Street payers”. Senator Elizabeth Warren voted against his nomination citing Atkins’ leadership before the 2008 financial crisis. “This job is about judgment and holding up on your resume that you were one of the people on the job to exercise judgment in the run-up to the biggest crash since the Great Depression, and now your hindsight is not 20/20. It’s 20/0,” Warren told one of the Senate committees.

On the other hand, many perceive Atkins’ confirmation as a “step in the right direction” as was expressed by Senator Tim Scott. “His tenure will mark a pivotal moment to roll back harmful Biden-era policies, promote capital formation, and enhance opportunities for retail investors,” Scott said in a statement. “Chairman Atkins will also provide regulatory clarity for digital assets, allowing American innovation to flourish, and ensuring we remain competitive on the global stage. I look forward to collaborating with Chairman Atkins to reignite our capital markets, which are vital for economic growth, job creation, and innovation.”

According to Atkins, his top priority will be “to work with [his] fellow commissioners and Congress to provide a firm regulatory foundation for digital assets through a rational, coherent, and principled approach.”

“This is a pivotal moment for our economy. Entrepreneurs, businesses, and individuals here at home and across the globe are eager to invest in America now that President Trump is at the helm,” Atkins told senators. “Yet, the current regulatory environment for our financial system inhibits investment and too often punishes success. Unclear, overly politicized, complicated, and burdensome regulations are stifling capital formation, while American investors are flooded with disclosures that do the opposite of helping them understand the true risks of an investment.”

As Atkins returns to the SEC, he will have to deal with a smaller staff. Hundreds of SEC staffers have reportedly taken the deferred resignation offered to federal workers via the Office of Personnel Management’s January email. As a result, at least 500 SEC employees left the agency, in an effort by the Trump administration to cut costs across federal agencies.   

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Greenwashing is when a company overstates its efforts towards its sustainability goals. In other words, a company engages in greenwashing when it deceptively advertises that its products, goals, and policies are environmentally friendly.

According to Frankfurter prosecutors, DWS engaged in greenwashing from mid-2020 to the end of January 2023. “The impression given to the capital market that DWS Group was supposedly the market leader in sustainable financial products was not, or not completely, fulfilled by the business’s organization itself,” the prosecutors said. DWS didn’t monitor the situation carefully enough and instead advertised itself as being a “leader” in the ESG field or incorporating ESG as an “integral part of our DNA.” They didn’t correspond to reality, according to prosecutors.

According to the investigation, the first documented instance of the alleged greenwashing occurred when DWS fired an executive who claimed that the company inflated its sustainability targets to investors. Shortly after, the firm was charged with similar greenwashing allegation by the Securities and Exchange Commission in which it agreed to pay a fine of $25 million. Specifally, DWS was charged for making “materially misleading statements” in connection to its ESG research and investments. The firm did not admit or deny the SEC’s findings.

DWS agreed to the terms of the settlement fine and said that it will not appeal. “We have already publicly stated in recent years that our marketing was sometimes exuberant in the past,” the firm said in a statement. “We have already improved our internal documentation and control processes and will continue to work on making further progress in this area.”  

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According to the new rule, Nasdaq will require that companies raise at least $15 million in order to list on its exchange. Nasdaq appears to have set an exceptionally high standard for microcap companies and other firms seeking to provide liquidity to their investors.

Nasdaq is changing the way it calculates public float, which refers to shares available for trading that are not held by insiders or restricted due to lockups. Previously, Nasdaq included shares registered for resale by existing investors at the time of an IPO in these calculations. Under the new rule, only newly issued IPO shares will be counted.

In its letter to the SEC, Nasdaq stated that “it has observed that the companies that meet the applicable Market Value of Unrestricted Publicly Held Shares requirement through an IPO by including Resale Shares have experienced higher volatility on the date of listing than those of similarly situated companies that meet the requirement with only the proceeds from the offering.”

As a result, Nasdaq is now only including newly issued IPO shares when making calculations in connection to its listing requirements as opposed to additionally including resale shares. The Exchange hopes that by doing so, it will not list companies exposed to high volatility. “As such, it is appropriate to modify the rules to exclude the resale shares from the calculation of market value,” Nasdaq told the SEC.

According to many in the capital markets industry, this rule could revive the dying Special Purpose Acquisition Company (SPAC) market. With the newly set bar, many companies will look to engage in reverse mergers which provides an alternate pathway towards an IPO.

Furthermore, companies seeking to uplist from over-the-counter markets, such as those operated by OTC Markets Group Inc., must now raise at least $5 million through a firmly underwritten public offering to list on the Nasdaq Capital Market, or $8 million to list on the Nasdaq Global Market. Previously, Nasdaq’s public offering requirement for both tiers was $4 million.

Ultimately, Nasdaq is implementing this rule to reduce the listing of highly volatile companies on its exchange. By excluding certain insider shares from its calculations, Nasdaq has established a higher threshold for companies seeking to qualify for listing.  

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In February, acting SEC Chair Mark Uyeda requested that the court pause a lawsuit that challenged the validity of the disclosure rules in order for the SEC to assess whether it would like to proceed with its defense of the rules. Uyeda requested that the court give the SEC 45 days to decide whether it would like to move forward with the case. Now that the 45 days is up, Uyeda informed the court that the SEC decided to drop its defense of the climate disclosure rules.

“The rule is deeply flawed and could inflict significant harm on the capital markets and our economy,” according to Uyeda “The goal of today’s Commission action and notification to the court is to cease the Commission’s involvement in the defense of the costly and unnecessarily intrusive climate change disclosure rules.”

SEC’s Decision Faces Criticism from One Commissioner 

Although, a majority of the SEC Commissioners opposed the rules, Commissioner Caroline Crenshaw, who originally voted in favor of the rules, denounced the Agency’s decision to step away from the lawsuit. According to Crenshaw, the SEC’s decision to step away goes against the procedures set out by the Administrative Procedure Act in effectively rescinding the rules.

“In effect, the majority of the Commission is crossing their fingers and rooting for the demise of this rule, while they eat popcorn on the sidelines,” Crenshaw said in a statement. “We are now firmly in a period of policy-making through avoidance and acquiescence, rather than policy-making through open, transparent, and public processes. This approach does not benefit the markets, capital formation, or investors.”

Crenshaw now requests that the court appoint someone else to take the SEC’s former place in defending the rules. It is not clear whether the court will do so or if someone will voluntarily step up to the plate.

For now, the climate disclosure rules will not be defended in terms of their validity and legality. As a result, unless someone is appointed or voluntarily takes action, the rules will be rescinded, and companies will no longer be required to disclose the impact of climate change on their businesses.  

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According to Uyeda, Gensler was too quick to enact rules. The “shortcuts” Gensler took led to numerous legal challenges which posed unnecessary expenses, according to Uyeda.

The Acting SEC chair now wants to adopt a different approach to SEC rulemaking- one that he believes will be more efficient and effective in its purpose. “Turning to future rulemaking, the Commission should act like a super-sized freighter, not a speed boat — and that means returning to a smoother regulatory course than the rapid changes that have been promulgated over the last four years, “Uyeda said.

The Administrative Procedure Act requires proposed rules to have a “notice and comment” period. While the duration of such a period is not explicitly provided, a comment period of at least 60 days has been endorsed by the Administrative Conference of the United States for significant regulatory actions. However, Uyeda pointed out that a large number of proposals were afforded comment periods well below 60 days under Gensler. “45-day, and even 30-day, comment periods were the norm… which “represented a significant deviation from everything that I had been taught about rulemaking as a member of the staff in my nineteen years with the Commission,” according to Uyeda.

Uyeda’s Steps Toward Implementing the “Blueprint” to Reform SEC Rulemaking

Uyeda has already taken a number of actions in pursuit of his “blueprint’s” implementation. The SEC Chair granted private fund advisers additional time to comply with newly expanded reporting requirements and extended compliance deadlines for a marketing rule aimed at environmental, social, and governance (ESG)-focused funds.

He also directed his staff to develop recommendations on re-proposing certain aspects of the recently-adopted Form N-PORT reporting requirements. This requirement mandates that certain funds regularly report their holdings to the SEC, with last year’s update requiring more frequent and detailed disclosures.

“Commenters raised concerns about more-frequent public disclosure of funds’ portfolio holdings,” Uyeda said in connection to the Form N-PORT changes. “Among other issues, are these concerns heightened by continuing advances in artificial intelligence?”

Uyeda also mentioned a possible change to crypto regulations including the added requirement for investment advisers to place customers’ crypto assets with a qualified guardian.

Ultimately, Uyeda emphasized how SEC rulemaking must “respect the limits of our statutory authority.” He understands that while this may take some time and patience, it is significantly more important that the SEC “take the time to do things carefully and methodically, rather than rush and risk actions that are not fully thought through.” This approach will ultimately help the SEC mitigate legal challenges, reducing costs, and most importantly, ensure that the agency stays within the scope of its authority.  

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