Crypto community wary as former SEC head takes over Wall Street jurisdiction

Former Securities and Exchange Commission (SEC) chair Jay Clayton has taken office as the US Attorney for the Southern District of New York (SDNY). Clayton confirmed his assumption of the role in a statement published on the US Attorney’s website. According to Clayton , the opportunity to serve in that position is an honor, and he looks forward to serving the country and protecting public safety while combating fraud. He also thanked President Donald Trump and Attorney General Pam Bondi for the opportunity. Clayton said: “I look forward to protecting public safety, combating fraud, particularly on the elderly and most vulnerable, ensuring the integrity of our financial system, and defending our national security.” Clayton’s appointment, which is currently on an interim basis, does not come as a total surprise, given that President Trump announced it last week on Truth Social Media. With the move, the former SEC top boss, who returned to Sullivan & Cromwell law firm and served as chairman of Apollo Management after his SEC stint, will now serve as a prosecutor for the first time in his career. Interestingly, he has reportedly started recruiting people to work with him. Politico legal reporter Erica Orden said that Clayton is hiring Sullivan & Cromwell partner Amanda Houle to lead the SDNY criminal prosecution. Houle spent eight years in the district before and was co-chief of the terrorism and international narcotics unit. Clayton’s appointment might ruffle feathers in the crypto community The appointment of Clayton to SDNY means that he would have jurisdiction over Wall Street, a role he is quite familiar with having been an SEC chair. However, many are wondering what his approach to the crypto industry will be, especially as traditional financial markets and the crypto industry continue to intertwine. During his time at the SEC, Clayton was behind the biggest crypto enforcement action from the agency, as he initiated the lawsuit against Ripple over the status of XRP. Clayton sued Ripple on December 22, 2020, and resigned a day after. Unsurprisingly, many in the XRP community blame him for the four-year legal drama over the status of the token. Even Ripple CEO Brad Garlinghouse had criticized Clayton in the past over the issue. However, the former SEC chair appears to have changed his view on crypto. In 2023, he called his replacement, Gary Gensler’s crackdown on crypto in 2023 a total abuse of power. Clayton would not have been the first person in Trump’s administration to oppose crypto before now; Trump himself was against crypto in his first tenure. Strong opposition to Clayton’s nomination in the Senate Meanwhile, whether Clayton would become the permanent US Attorney for the SDNY remains very much in the air, given that he has not been confirmed by the Senate. Although he can serve in an interim capacity for 120 days, any hope of confirmation from the Senate is slim, with Senator Chuck Schumer saying he would block the nomination. Schumer can do this because the Senate blue slip policy gives Senators the power to block US attorneys’ nominees for their home state. According to Schumer, he is blocking the nomination to prevent Trump’s Justice from gaining control of the US Attorney office for the SDNY. The district office is already embroiled in controversy with the Department of Justice (DOJ) after the DOJ ordered the SDNY to drop the case against New York City Mayor Eric Adams. Several prosecutors at SDNY and Washington resigned in protest over the matter. Despite Senator Schumer’s plans, Clayton could still become the permanent US attorney. All that is required is for judges of the federal district court of Manhattan to vote to keep him on the job after the 120 days elapse and for the President not to nominate a replacement. Nevertheless, there are speculations that the federal judges could decide to appoint someone else to the role, given that the majority of them were appointed by Democratic presidents. However, the likelihood of that is slim. Cryptopolitan Academy: Coming Soon – A New Way to Earn Passive Income with DeFi in 2025. Learn More

Source: Cryptopolitan