In February, the Department of Government Efficiency (DOGE) began to request public input regarding the US Securities and Exchange Commission (SEC) – a step suggesting that the Agency Reform is imminent.

Since then, in line with President Trump, SEC has taken a far less conflicting attitude towards the cryptocurrency industry, as shown in the appointment of crypto-related staff and abandoning several lawsuits and investigations of cryptic businesses. However, DOGE has the potential to implement further changes, and the interest in SEC signalizes the growing pressure against regulators to reassess their approach to digital assets.

In response to the request for public input, Paul Grewal, Head of Legal Officer in Coinbase – suggested one of the companies that no longer face a trial from SEC – a policy that required SEC to repay legal costs for companies that successfully challenge enforcement efforts. The motivation for his proposal is obvious, but the effect on crypto is likely to be a little wider.

As Joel Khalili summed CableSEC’s recent retreat from litigation represents “an early signal of the agency’s intention to work arm in arm with the industry to come up with a set of rules to manage crypto transactions and products.”

As things currently stand, SEC’s lack of proactive guidance makes it difficult for companies to plan long -term compliance strategies, and their enforcement measures often come after years of operation, leaving companies and their investors exposed to unforeseen legal risks. In the future, this is likely to change.

Ready compliance with reactive enforcement

Trusting enforcement instead of proactive guidance has forced companies such as Coinbase, Ripple and Celsius to spend millions in litigation to clarify their regulatory status. But in one case against the debt box, SEC admitted inaccuracies in its statements, which led to a court ordering SEC to cover the company’s legal expenses – a preview of Coinbase’s proposal. The order raises doubts about the agency’s credibility and highlighted concern about its enforcement practice.

In the future, you can expect to see regulatory agencies – including SEC – under increased pressure to adapt to the US Treasury approach that prioritizes clear compliance paths rather than reactive enforcement. The treasuries’ guidelines for digital asset are far more structured and addresses key areas such as tax reporting, compliance and AML targets. Standardized definitions of what constitutes a safety in the crypto area are important to help companies structure their products correctly from the start.

A balancing action

In addition to note from the Treasury, SEC can also look at the IRS for inspiration. A “safe port” determination for early -stage projects could encourage innovation, while ensuring compliance over time, corresponding to proposals previously discussed by SEC Commissioner Hester Peirce. The IRS already embraced this approach and issued temporary transitional relief for crypto taxpayers in January 2025.

The IRS was historically dependent on voluntary disclosure programs to bring taxpayers into conformity rather than introducing punitive actions in advance. A similar model should also be used for crypto regulation.

While some people assume that regulation inherently prevents innovation, the opposite may be true. This is because clearly defined protective frames will lure more risk -averse devices to enter the ecosystem and help it grow. An easy regulatory touch Requires Robust Backend enforcement and can lead to unnecessary friction between supervisory authorities and businesses.

In total, better coordination between SEC, Treasury and IRS would help prevent regulatory conflicts and streamline compliance obligations for digital asset companies and stakeholders. The treasuries’ guidelines for digital asset already offer a strong foundation for this type of cross -cutting agency adjustment. The current legislative uncertainty and SEC’s reactive enforcement method of stifling growth, while a clearer, more coordinated framework would benefit the entire ecosystem.

The lower line

Between Doge’s request for input, the new administration’s broader obligation to reform of digital asset and Coinbase’s proposal, the stage is set for reforms aimed at making regulatory supervision more predictable. While we are in the early stages of the new administration, changes already occur at a staggering pace. It is clear that Dog’s influence on SEC policies will make influence – especially with public discourse on these issues, which further strengthens the case for clearer guidelines rather than regulation by enforcement.

Of course, it is worth noting that Doge’s plans for SEC are likely to extend beyond crypto, just as the efforts to regulate the industry extend beyond SEC. Ultimately, it would be advantageous for the new administration in connection with Congress to create a regulatory framework for the industry so that businesses and individual taxpayers understand what constitutes a product, security and digital asset. In other words, we have to learn to go before we run. Meanwhile, SEC must adopt a strategy that can promote growth while maintaining investor protection.