House Democrats are pressing the US Securities and Exchange Commission to explain a pullback from crypto enforcement, and they are spotlighting the agency’s paused case against Tron founder Justin Sun.
In a January 15, 2026 letter to SEC Chair Paul Atkins, Representatives Maxine Waters, Brad Sherman, and Sean Casten urged the SEC to restart crypto enforcement.
They said the SEC dismissed or closed at least “one dozen” crypto matters since January 2025, including actions involving Binance, Coinbase, and Kraken.
The lawmakers pointed to court rulings that kept major parts of the SEC’s complaints alive before the agency later agreed to dismiss the matters. They cited the SEC’s May 2025 dismissal of its Binance case, after a judge allowed much of the suit to proceed.
They also cited the SEC’s February 2025 dismissal of its Coinbase case and the March 2025 dismissal of its Kraken case. In the letter, the lawmakers noted that the SEC framed those dismissals as discretionary choices tied to a shift in crypto regulation and an internal crypto task force.
The Democrats centered their request on SEC v. Sun, a 2023 case that alleges unregistered securities offerings, fraud, and market manipulation tied to TRX and BTT. The SEC asked a federal court to stay the litigation in February 2025 while the parties explored a potential resolution.
In the letter, the lawmakers said the continued stay weakens investor confidence and signals selective enforcement. They asked the SEC to seek to lift the stay and litigate, or to negotiate a settlement that matches the case’s alleged facts and requested relief.
The lawmakers also demanded records tied to the Justin Sun decision. They asked the SEC to preserve and produce internal documents and communications about closing, dismissing, or pausing crypto cases, including any contacts with outside parties.
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The Democrats said the enforcement shift overlaps with a period of heavy political spending and business links between parts of the crypto industry and President Donald Trump’s circle. The letter cited campaign and inauguration donations, and it referenced a 2025 Binance-related deal that used World Liberty Financial’s stablecoin.
The lawmakers said these overlaps create the appearance of a “pay-to-play” dynamic. They also noted that they have not presented public evidence that specific token purchases caused the SEC’s litigation decisions, and they asked the agency for transparency to clarify its process.
Outside government, watchdog group Public Citizen reported that federal agencies canceled or froze 159 corporate enforcement actions during Trump’s first year back in office. Public Citizen estimated that at least 18 corporations avoided $3.1 billion in penalties tied to alleged misconduct, including an SEC settlement the group highlighted.
The SEC’s leadership structure has also shifted. Commissioner Caroline Crenshaw left the agency on January 2, 2026, leaving no Democrat-appointed commissioners as of early January, according to the SEC and Thomson Reuters.
The SEC has not addressed the lawmakers’ questions. Cointelegraph reported that it sought comment from the SEC and a Sun spokesperson without receiving a response at publication. The dispute now puts SEC crypto policy and court strategy under sharper scrutiny this week.