SEC Requests Additional $158M To Counter Cryptocurrency Risks and Market Changes
Summary:
The U.S. Securities and Exchange Commission (SEC) is requesting an additional $158 million from the 2025 federal budget to adapt to significant changes in the financial markets, especially in cryptocurrency. The requested budget for 2025, according to the SEC's Congressional Budget Justification, is $2.594 billion, up from $2.436 billion in 2024. The increased funding will support staffing expansion across the SEC's divisions to tackle emerging challenges and risks, particularly those related to cryptocurrency and financial technology. In 2023, the SEC undertook 46 enforcement actions related to cryptocurrency, a notable increase from 2021, although these accounted for less than 6% of its total activities.
To cope with the considerable expansion and transformation in the financial markets, particularly cryptocurrency, the United States Securities and Exchange Commission (SEC) is seeking an additional $158 million from the 2025 federal budget. The recent Congressional Budget Justification presented by the SEC for 2025 has put forth a request of $2.594 billion, a surge from the $2.436 billion asked for in 2024. Gary Gensler, the SEC Chairperson, highlights the rapid advancement in technology which is reshaping markets and endorsing new business models, as stated in the 148-page document. The document elucidates the agency's funding requirements and contains a performance report for the previous year.
Gensler pointed out the evolving dynamics of investor communications, including Reddit forums and celebrity influencers, and the unpredictable nature of the cryptocurrency market, where investors are risking their funds in an extremely speculative sector. The change facilitates more opportunities for violations, which necessitates the SEC's capacity to keep up with the deceptive practices, he added.
Part of the additional funding sought is to increase staffing across all levels of the SEC. The target is set at 5,621 positions for 2025, an increase from the 2024 aim of 5,473 roles. The regulatory body's compliance department, known as the Division of Examinations, plans to add 23 roles to handle urgent and emerging risks involving cryptocurrency and financial technology.
The Office of Investor Education and Advocacy has requested an extra role to deal with queries and grievances on fraudulent crypto-asset securities. The Office of the General Counsel also requires two additional positions to tackle heightened administrative and civil litigations against the commission and to support its whistleblowing program.
The performance report for 2023 revealed that the SEC achieved or surpassed 28 out of 36 targets but fell short on six. The goals outlined by Gensler in 2022 for the four-year plan of the agency included guarding the public against fraud, establishing a legal framework, and strengthening workforce diversity. In 2023, the SEC carried out 46 enforcement actions related to cryptocurrency litigation or administrative proceedings, a noticeable rise from 2021. Nevertheless, these constituted less than 6% of the total 784 actions that year.
Published At
3/19/2024 5:40:20 AM
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