As the Securities and Exchange Commission’s five voting members sat before lawmakers on Capitol Hill in September, House Financial Services Committee Chair Patrick McHenry (R-NC) pressed the agency’s head about a supposed lack of regulatory clarity regarding crypto.

“The laws are clear, and it’s written by the Supreme Court,” SEC Chair Gary Gensler began to say before McHenry cut him off—turning to Gensler’s Republican-appointed colleague, SEC Commissioner Hester Peirce, to ask about the agency’s stance on crypto regulation again.

“We’ve taken a legally imprecise view to mask the lack of regulatory clarity,” Peirce responded, with Gensler just a few feet away. “It’s always helpful to have Congress weigh in, but there certainly are some guidelines we could provide in this area that we have chosen not to.”

The exchange lasted minutes, but it underscored years-long tension over the SEC’s regulatory approach to crypto. It also highlighted a partisan divide within the agency over whether broad swathes of the crypto industry fall under its remit, requiring digital asset firms to abide by the agency’s decades-old rules relating to securities.

Gensler, who once said that “everything but Bitcoin” falls under the agency’s purview, served as a political cudgel this year, even as President-elect Donald Trump curried favor with the crypto industry. Nonetheless, Wall Street’s top cop leaned into the agency’s enforcement blitz, ticketing crypto firms for allegedly violating its rules while putting several others on notice.

Gensler, who was appointed by President Biden to lead the SEC, indicated last month that his tenure was ending. He signaled he’d leave when Trump begins his second term on January 20, 2025.

Trump, delivering on one of his crypto-related campaign promises, has appointed former SEC commissioner Paul Atkins to replace Gensler. 

“I would expect Paul Atkins to have a completely different approach,” Stephanie Avakian, a partner at WilmerHale, who formerly served as director of the SEC’s Division of Enforcement, told Decrypt. “He is both experienced and practical and is well-known.”

Crypto advocates may be excited about the prospect of Atkins’ leadership, but it remains to be seen where the nominee could take existing lawsuits against crypto companies like Binance, Coinbase, Ripple Labs. 

Anthony Tu-Sekine, a partner at Seward & Kissel, told Decrypt the SEC could face reputational harm if it quickly abandoned the high-profile cases after pressing forward with them and expending resources.

“The SEC is more like a supertanker than a race boat,” Tu-Sekine said. “Don’t expect Atkins to become chairman and come out two days later and say we’re dropping all those cases. The staff has worked diligently on these cases, came to a conclusion about the law, and ultimately ended up convincing the higher-ups that a suit should be brought,” he said.

Capitol Hill

When Gensler was nominated to lead the SEC in 2021, industry participants were cautiously optimistic. However, Gensler’s experience teaching a class on blockchain at MIT did not lead to clearer “rules of the road,” as some had hoped.

In maintaining that existing laws were sufficient to regulate digital assets, he emerged as an industry antagonist. An aggressive string of crypto-related enforcement actions meanwhile heightened advocates’ concerns that the agency’s approach was overzealous.

Reflecting on his tenure as SEC Chair in November, Gensler stood by the agency’s focus on fostering compliance with securities laws in the crypto market. Having drawn comparisons to the “Wild West” before, the sheriff hitched his agency’s approach to protecting investors.

“This is a field in which over the years there has been significant investor harm,” Gensler said. “Further, aside from speculative investing and possible use for illicit activities, the vast majority of crypto assets have yet to prove out sustainable use cases.” 

That same day, 18 states filed a lawsuit against the SEC, alleging that the regulator’s enforcement-based gambit violated the law. Brought by Republican attorney generals and the DeFi Education Fund, the accusations of regulatory overreach highlighted a sense of political angst that the President-elect had seized on months before.

“I will fire Gary Gensler on day one,” Trump vowed at a Bitcoin conference in July. “The day I take the oath of office, Joe Biden and Kamala Harris’ anti-crypto crusade will be over.”

Gensler’s leadership was scrutinized time and again by Republican lawmakers on Capitol Hill, but the sentiment that existing laws were good enough received bipartisan pushback this year. As 71 Democrats in the House of Representatives voted in favor of a crypto market structure bill in May alongside Republicans, they signaled the status quo needed some form of overhaul.

Both chambers of Congress also passed a bill that would have repealed SAB 121, SEC guidance requiring banks to recognize digital assets as liabilities on their balance sheets. After President Biden vetoed the bill, House members failed to override it. However, 21 Democrats showed opposition to Biden’s veto, so there was bipartisan support there, too.

The crypto industry’s unprecedented political spending efforts in 2024 likely contributed to lawmakers’ performance. The Democratic presidential nominee, Kamala Harris, later distanced herself from the SEC’s approach, advocating for a regulatory framework as Election Day approached, but by that time, it was too late.

As Vice President Harris rose to the top of the Democratic ticket, Rep. Wiley Nickel (D-NC) previously told Decrypt that there were signs the presidential nominee would take a “​​balanced approach” to crypto. Mark Cuban threw his hat into the ring as a potential successor to Gensler, but the billionaire’s ambitions of leading the agency ultimately fell short.

‘Not great for entrepreneurs’

Even though the SEC faced several setbacks in court, the Commission had a banner year in terms of the amount of cash that enforcement actions brought in. Meanwhile, the agency pushed forward with high-profile lawsuits, tuning out the political heat that Gensler faced.

In fiscal year 2024, the SEC secured $8.2 billion in penalties across 583 enforcement actions affecting U.S. capital markets. Of that sum, $4.5 billion came from a lawsuit against Terraform Labs and its founder, Do Kwon. They were found liable for civil fraud charges related to the $40 billion collapse of UST and LUNA in 2022.

The lawsuit marked a major victory for the SEC, as a federal judge determined that Kwon and Terraform Labs had offered LUNA and UST to investors as securities. However, the SEC encountered a significant setback in the Southern District of New York, where the case was filed.

After finding that XRP, a token stewarded by Ripple Labs, was not “necessarily a security on its face,” a federal judge ordered Ripple to pay $125 million in fines for XRP transactions that did violate the law. The SEC later appealed the ruling, but it had sought $2 billion in civil penalties after bringing the case in 2020—before Gensler came to lead the agency.

“Charitably, the SEC got a bloody nose,” Tu-Sekine said. 

Still, the SEC was able to hold on to lawsuits against Binance and Coinbase. Last year, the regulator alleged that both firms violated its rules, allegedly operating as unregistered exchanges, broker-dealers, and clearing agencies, among other accusations.

In March, a federal judge found that arguments alleging Coinbase offers investors unregistered securities were plausible, denying most of the company’s motion to dismiss. In June, a federal judge ruled that the SEC’s case against Binance could also proceed, while charges related to the leading crypto exchange’s Simple Earn product and certain token sales were dismissed.

Those lawsuits, along with one against crypto exchange Kraken, are ongoing. The legal costs associated with crypto-related enforcement actions are increasing, according to the Blockchain Association, an advocacy group that estimated the figure to be at least $400 million, using self-reported data from its member companies.

“While that creates a lot of work for lawyers, it is not great for entrepreneurs,” CEO Kristin Smith told Decrypt. “In terms of whether their projects comply with the U.S. securities laws, they have to read between the lines of various court opinions and briefs that the SEC submits.”

Some lawsuits initiated last year came back to bite the SEC, namely the Commission’s case against DEBT Box, a crypto mining firm. In August 2023, SEC attorneys attained an ex parte restraining order against the firm, freezing DEBT Box’s assets before it could argue otherwise.

In May, the case was dismissed as a federal judge ordered the SEC to pay $1.8 million for DEBT Box’s legal fees. The regulator had made “false and misleading statements” in attaining the restraining order, Utah District Court Judge Robert Shelby found. A week later, the SEC closed its regional office that had brought the case, citing “significant attrition.”

Enforcement threats

Minutes after Gensler signaled his resignation in November, a federal judge in Texas dealt the agency another blow. By expanding the definition of “dealer,” the SEC would’ve forced decentralized finance projects to register as securities exchanges and brokers. But the court found that measure was unlawful, ordering the SEC to axe the modifications in question.

While the SEC has focused on crypto exchanges and digital asset issuers under Gensler’s leadership, the Commission’s scope expanded this year in terms of enforcement threats. Issuing Wells Notices, the SEC warned firms a lawsuit could be coming in areas previously untouched, such as decentralized finance (Uniswap Labs), NFTs (OpenSea), and gaming (Immutable).

Additionally, the Commission issued enforcement warnings to companies such as the trading app Robinhood, examining its cryptocurrency offerings after the firm tried to “register” its services with the agency, which Gensler had urged digital asset firms to pursue earlier.

“This is not the way Americans expect our government to work,” Robinhood’s legal chief and former SEC commissioner Dan Gallagher later testified before Congress. “Rather than issue rules to provide regulatory certainty to an industry craving it, the SEC has instead targeted individual firms, including Robinhood, through regulation by enforcement.”

Ultimately, Gensler’s leadership had “an immense chilling effect” on the crypto industry, Katherine Snow, general counsel at Thesis, a venture capital firm, told Decrypt. Either forcing companies to axe projects or move overseas, she said the U.S. will have to pick up the pace to compete with regulatory progress on crypto made internationally.

However, Snow saw one noticeable drawback with Gensler’s slated departure. Over the past several years, legal minds across the industry have been united in fighting what was perceived as an existential threat.

“Because we had this common enemy, everyone was able to really rally behind each other,” Snow said. “It’s going to be pretty fascinating to see what the approaches are of the various trade associations over the coming months and years, as we approach this new SEC.”

Edited by Sebastian Sinclair

Hackers have grown more sophisticated and continue to rake in billions of dollars from crypto exploits.

The good news? There isn’t any—2024 has officially surpassed last year’s totals for stolen funds, with months of hacks piling on to an already record-breaking year. 

By Q3 2024, blockchain intelligence firm TRM Labs reported that over $2.2 billion had been stolen in crypto hacks—exceeding the $1.8 billion lost in all of 2023. 

Now, as the year comes to a close, the total continues to climb. Analysis reveals that thefts weren’t limited to the experimental world of decentralized finance, or DeFi; centralized crypto exchanges were also prime targets. 

Here are the biggest crypto heists of 2024.

DMM Bitcoin’s $308 million

Japanese crypto exchange DMM Bitcoin lost over 4,500 BTC—worth $308 million at the time—to hackers back in May.

It’s unclear how hackers managed to steal from the exchange, but TRM Labs said that stolen private keys were a plausible explanation.

The company is still shutting down and transferring customer accounts to another exchange, SBI VC Trade, which is taking over its assets.

PlayDapp’s $290 million

Hackers targeted the crypto gaming platform PlayDapp twice in February by exploiting a private key vulnerability. They made off with $290 million in PLA tokens across the two incidents. 

The attackers also ignored a $1 million white hat reward to return the stolen funds. To this day, the funds are still missing. 

WazirX’s $235 million

Indian crypto exchange WazirX was also targeted in June, with hackers running away with close to $235 million. 

WazirX suspended all withdrawals, leaving users unable to access their funds after the hack. Elliptic said that the attack was linked to North Korea.

The exchange’s parent company, Zettai Pte Ltd, secured a four-month moratorium from the Singapore High Court in August in a bid to get its finances in order. 

Things took a weird twist in October when the co-founder of rival exchange CoinSwitch accused WazirX of transferring $75 million worth of user funds to top exchanges Bybit and KuCoin in the wake of the attack. 

WazirX has since said that it’s in the process of “rebalancing tokens,” and clients will soon be informed on the next steps to repay creditors.

Ripple co-founder Chris Larsen’s $112.5 million

Hackers targeted Ripple co-founder and Executive Chairman Chris Larsen’s XRP stash on January 30. The crypto entrepreneur wrote on X that there had been “unauthorized access to a few of my personal XRP accounts,” but reassured people that Ripple itself hadn’t been targeted.

Still, it was a hefty attack, and blockchain sleuth ZachXBT said that hackers made away with about 213 million XRP—$112.5 million at the time—before laundering it through exchanges. Efforts to recover the stolen assets have been unsuccessful.

Orbit Chain’s $80 million 

The year began with a significant DeFi breach, as hackers drained over $80 million from the cross-chain bridge project Orbit Chain on January 1. Criminals took off with Ethereum and the stablecoin DAI in the exploit—and then fell silent.

Months later, millions of dollars of the stolen crypto was moved to coin mixer Tornado Cash. Other than a January statement apologizing for the exploit, the team behind the project has since given little update on what happened—or how it would retrieve the stolen funds. 

BtcTurk’s $54 million 

On June 22, hackers targeted the Turkish crypto exchange BtCTurk—which caters to the country’s budding market. Most of the funds were in the form of Avalanche (AVAX), the 12th-largest digital asset by market capitalization. 

The exchange reassured users that most funds—kept in cold storage—were safe. Meanwhile, a day after the hack, Binance CEO Richard Teng said his exchange had frozen $5.3 million in stolen funds to assist BtcTurk’s efforts.

Radiant Capital’s $50 million

In October, Hackers hit DeFi project Radiant Capital in “one of the most sophisticated hacks ever recorded in DeFi,” making away with $50 million in tokens at the time. 

The breach happened after a Radiant developer received a Telegram message from what appeared to be a former contractor, the protocol said. The message contained a PDF, which was then used to deliver malware and subsequently gain control of several private keys, allowing hackers to steal USDT, USDC, and ARB tokens. 

Radiant Capital, which allows users to earn interest and borrow crypto, has since said that North Korean hackers were behind the attack. 

U.S. government’s $20 million

Hackers even targeted the Feds this year with over $20 million worth of stablecoins and Ethereum disappearing in October from a government wallet containing funds seized from criminals.

The crypto in question was tied to a previous 2016 hack of the Bitfinex exchange. Hackers sent the coins and tokens to a new address, prompting pseudonymous blockchain sleuth ZachXBT to say it was likely a theft.

Then, the next day, close to $19.3 million worth of the pinched funds were returned to the wallet, data collected by Arkham Intelligence shows. It still isn’t clear what happened to the rest of the stolen crypto—or why hackers returned it in the first place.

Edited by Sebastian Sinclair

Some countries are mulling a national Bitcoin reserve amid a historic market run-up that has pushed the world’s largest cryptocurrency to new heights in recent weeks.

United States President-elect Donald Trump and his allies have repeatedly thrown their support behind a bill to stock the Federal Reserve with the asset, and will soon be in position to potentially make that a reality.

Government officials in Brazil have also put forth legislation to realize that possibility, while politicians in Poland and Russia have endorsed the idea of adding the digital currency to their nations’ balance sheets.

El Salvador led the charge on this front, making Bitcoin legal tender while gradually amassing BTC for its own reserve starting in 2021—and now President Bukele is taking a victory lap as the asset surges towards $100,000.

While it’s unclear whether other countries will actually stockpile Bitcoin anytime soon, one thing is obvious: Interest in holding the token as a reserve asset has reached a fever pitch. Here’s who is considering a national Bitcoin reserve.

United States

Several U.S. lawmakers have made pushes to establish a strategic Bitcoin reserve.  

Senator Cynthia Lummis of Wyoming last spring unveiled a bill called the “Bitcoin Act” that calls for the U.S. to acquire as much as 200,000 Bitcoin annually over a five-year period, or up 5% of the token’s total supply.

The Bitcoin would be kept in a “decentralized network of secure Bitcoin vaults operated by the United States Department of Treasury,” with token acquisitions being accomplished through a diversification of existing Federal Reserve funds such as bonds, loans and gold.

President-elect Donald Trump similarly endorsed a “strategic Bitcoin stockpile” last July at BTC 2024 in Nashville—one of many such crypto-related promises that he’ll be expected to honor once in office.

“It will be the policy of my administration…to keep 100% of all the Bitcoin the U.S. government currently holds or acquires into the future,” Trump said at the event.

Brazil 

Brazil’s government has proposed a bill that would green-light a national Bitcoin reserve. 

The Sovereign Strategic Reserve of Bitcoins (RESBit) would account for 5% of Brazil’s international reserves, according to the proposed legislation, filed on November 25. It aims to diversify the Brazilian Treasury’s assets.

Incorporating Bitcoin into the Treasury “will reduce Brazil’s exposure to exchange rate fluctuations and geopolitical risks, increasing economic resilience,” Federal Deputy Eros Biondini said in the proposed bill.

Under the proposal, Brazil’s Central Bank would manage the Bitcoin reserve in partnership with the Ministry of Finance. Those funds would be used to back Brazil’s CBDC, called Drex. The Bitcoin would be stored in cold wallets, according to the bill.

Poland 

Polish presidential candidate Sławomir Mentzen has advocated for the creation of a strategic Bitcoin reserve, as well as for the passing of crypto-friendly laws and regulations in Poland. 

“If I become the President of Poland, our country will become a cryptocurrency haven, with very friendly regulations, low taxes, and a supportive approach from banks and regulators,” Mentzen said in a recent post on X (formerly known as Twitter).

“It is high time Polish politicians also look to the future,” the politician said in another X post. 

The far-right nationalist candidate is running third in the polls in the Eastern European country. It is unclear if Mentzen’s political opponents also support the creation of a strategic Bitcoin reserve.

Russia 

Several Russian legislators this month have suggested creating a “stash of” crypto in “the state Treasury,” despite opposition from Russian State Duma Committee Chairman Anatoly Aksakov. 

They also succeeded in passing legislation legalizing crypto mining and the use of digital assets for international payments this fall. 

Russia’s recent change of tune on crypto suggests the Eastern European country could revisit the issue of a strategic Bitcoin reserve, which at least one of its top officials has previously expressed support for.

In a 2021 interview with Russian news outlet Interfax, Deputy Minister Foreign Affairs Minister Alexander Pankin expressed an openness to partially replacing the country’s U.S. dollar-backed reserves and trade settlements with other currencies, including cryptocurrencies. 

Russia could replace U.S. dollars with various national currencies as well as “in the future, probably…some kind of digital assets,” Pankin told the outlet.

Edited by Andrew Hayward and Sebastian Sinclair