SEC’s Caroline Crenshaw faces intense opposition ahead of Senate vote

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The Senate Banking, Housing and Urban Affairs Committee is expected to decide tomorrow whether to reappoint Caroline Crenshaw as SEC commissioner. Crenshaw’s re-nomination, however, faces intense opposition from the crypto industry due to his perceived anti-crypto stance.

The Digital Chamber, a US advocacy group focused on promoting blockchain technology and the digital assets industry, has publicly urged the Senate Banking Committee to reject SEC Commissioner Caroline Crenshaw’s nomination for a second term.

In a December 12 letter, the organization claims that Crenshaw’s tenure has been characterized by a negative and outdated view of the digital asset market, as evidenced by his dissent on one-time approvals of Bitcoin ETFs and his opposition to the conversion of Grayscale Bitcoin ETF.

The Digital Chamber is calling for Commissioner Crenshaw to be replaced, as it believes a new commissioner is needed to foster a more balanced and forward-thinking regulatory framework for the digital assets sector.

Crenshaw was appointed to the SEC in 2020 by former President Trump and was reappointed by President Biden for a second term. If confirmed by the Senate, his term would extend beyond the usual five years, perhaps until June 2029.

Some Republicans say Democrats are rushing to confirm Crenshaw before potentially losing their Senate majority in January. The vote is expected to take place at 9:45 a.m. EDT, just days before Congress adjourns for the year.

Critics say the timing reflects a strategic push by Democrats to secure Crenshaw’s position at the SEC, maintaining a regulatory framework they believe is necessary to oversee the crypto sector.

As the key vote approaches, the crypto industry is uniting to challenge Crenshaw’s re-nomination. The digital House letter is part of a unified lobbying effort to directly oppose Crenshaw’s reappointment.

Industry figures, including Coinbase CEO Brian Armstrong, have publicly denounced Crenshaw’s record. Armstrong called her a failure as SEC commissioner and urged lawmakers to vote against her nomination.

A number of digital asset organizations, including the Blockchain Association and the DeFi Education Fund, have mobilized efforts to block his confirmation, arguing that his actions undermined Congress’ mandate for robust regulation of of cryptography.

The Cedar Innovation Foundation, a dark money group backed by undisclosed crypto interests, launched a digital ad campaign calling Crenshaw “more extreme” than Gensler, citing his opposition to Bitcoin ETF screening and his “box” remark of Petri”.

If all Democratic members of the Senate Banking Committee voted in favor of Crenshaw, they could get enough votes to advance his nomination to the full Senate.

Even though Crenshaw enjoys the support of Democratic senators, the intense lobbying against her and the changing political landscape, which has seen several Senate seats go to Republicans, create a difficult confirmation environment.

Caroline Crenshaw and Jaime Lizárraga are two SEC commissioners who voted against approving Bitcoin spot ETFs in January. On the other hand, Gary Gensler, the current chairman of the SEC, often seen as critical of the crypto industry, as well as commissioners Hester Peirce and Mark Uyeda, have supported the approval of these products.

Lizárraga will leave the SEC on January 17, 2025, just three days before Gensler leaves, leaving Caroline Crenshaw as the commission’s sole Democrat.

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