US Securities and Exchange Commission (SEC) Chairman Gary Gensler testifies before an oversight hearing of the House Financial Services Committee on Capitol Hill in Washington, US September 27, 2023.
Jonathan Ernst Reuters
Securities and Exchange Commission Chairman Gary Gensler will resign on January 20, the agency announced Thursday, paving the way for President-elect Donald Trump to appoint an immediate replacement.
Gensler took over the SEC in 2021, and under his leadership the commission took an ambitious but controversial approach to several regulatory issues, including cryptocurrencies. Trump has not announced his choice to lead the SEC, but the hope is that the next chair will be friendlier to Wall Street and crypto.
SEC commissioners serve five-year terms, so Gensler could in theory stay on until at least 2026. However, he is leaving the agency full time, as expected.
“The staff and the Commission are very mission-driven, focused on protecting investors, facilitating the formation of capital, and ensuring that the market works for investors and issuers alike. The staff includes true public servants. with them on behalf of the American people every day and ensure that the capital market we remain the best in the world,” Gensler said in a press release.
In Gensler, the SEC pushed to require more disclosures from public companies and financial advisors to investors. These new areas of disclosure include risks around climate change and cyber security. The agency also shortened the settlement time for stock trades to just one day, a change prompted by meme stock trading in early 2021.
SEC Gensler has had several high-profile disputes with the crypto industry, including a legal battle with Grayscale to block bitcoin ETFs. Grayscale won in court, and billions of dollars have flowed into the new fund since it launched in January. The SEC has sued several large digital asset companies in recent years over the way they handle or sell crypto, including Coinbasewith mixed results.
The SEC has also been at odds with it Tesla CEO Elon Musk in recent years, including investigating him for potential fraud in the $44 billion purchase of the social media company Twitter, now known as X, in 2022. The agency is now seeking sanctions against Musk after he passed court-ordered testimony in about that. probe.
In Gensler, the SEC has been investigating whether Musk complied with a previous settlement agreement that required the billionaire CEO to have securities lawyers review some social media posts about Tesla before sharing them.
Musk, who has been a public critic of the SEC, campaigned with Trump and will work with the new administration as co-head of the Department of Government Efficiency.
Trump could have a chance to shape the SEC quickly. In addition to Gensler’s vacant seat that will be vacated, the terms of two of the other four commissioners will expire in 2024 or 2025.
Commissioners may serve up to 18 months beyond the end of their term. Presidential appointments to the SEC are subject to the advice and consent of the Senate.
– CNBC’s Lora Kolodny contributed reporting.
