Head of SECs Crypto Enforcement Resigns Amidst Debate Over Crypto Regulation
David Hirsch, who has been heading the cryptocurrency enforcement division of the U.S. Securities and Exchange Commission (SEC) for almost a decade, announced today on LinkedIn that he is stepping down. This comes after Ladan Stewart, another SEC lawyer, left for a private firm after eight years.
In his announcement, Hirsch expressed that leaving the SEC is a difficult decision, but he is looking forward to new challenges. However, his future plans remain unknown.
Shortly after news of Hirsch’s departure broke, rumors began to circulate that he has taken on a new role as the Chief Trading Officer at Pump.fun, a token issuance platform for various memecoin projects on Solana and Ethereum’s Layer-2 Blast. Although the project tweeted to confirm Hirsch’s decision to join, Hirsch himself has not officially confirmed the news.
During his time at the SEC, Hirsch, along with SEC Chair Gary Gensler, played a crucial role in regulating the cryptocurrency industry. Both Hirsch and Gensler have been vocal critics of the cryptocurrency industry, particularly Decentralized Finance (DeFi) and projects that are perceived to be in violation of securities laws.
Hirsch has previously made strong statements targeting the cryptocurrency industry, warning that the SEC has been closely monitoring DeFi exchanges and projects that it deems to be in violation of securities laws, similar to Coinbase and Binance. The enforcement department will also pay attention to DeFi projects.
Several decentralized finance (DeFi) entities and cryptocurrency exchanges, including Ripple, Binance, and Coinbase, have been under the SEC’s scrutiny. Ripple partly won a legal lawsuit last year after a judge ruled that XRP, Ripple’s native token, was not a security in secondary market transactions. Binance and Coinbase are still facing SEC lawsuits.
The departure of Hirsch comes at a time when cryptocurrency is becoming increasingly relevant in U.S. politics leading up to the midterm elections. The SEC, with Chairman Gary Gensler at the center of the debate, has long been a point of contention for crypto advocates.
Some believe that the SEC’s approval of Ethereum spot ETFs could be politically motivated in anticipation of the November election results, given Gensler’s history of pushing back against the industry. Hirsch’s departure from the SEC follows another high-profile exit in February 2024, when Ladan Stewart, a lawyer known for her work on high-profile cases against Ripple and Coinbase, left the agency’s Enforcement Division after eight years to join White & Case LLP as a partner.
