The SEC's Enforcement Pullback Rewards Coinbase

Read quickly, that number says one thing. Washington quit policing crypto. The number hides the shape of the year, though.

Filings nearly tripled from the first half to the second, climbing from 93 cases to 215¹. September alone carried close to a third of the total. The agency that walked away from crypto's biggest platforms kept chasing its smallest ones.

Congress left the opening the agencies filled. The CLARITY Act would have split crypto oversight between the SEC and the CFTC by law⁵. Senators blocked it in a cloture vote in September 2026, short of the 60 votes needed to end debate. Michael Selig runs the CFTC. He told CNBC in October 2026 he was "absolutely disappointed in Congress," then said his agency would write its own rules anyway.

Selig's CFTC proposed its first rules written only for crypto markets on Oct. 5, 2026, called Regulation CTX and Regulation CAM². Major platforms including Coinbase, Crypto.com, Bitnomial, Kalshi and Polymarket already hold the federal registration those rules assume. He frames the shift as freedom for builders, away from bank rules once stretched to cover them. “A person should not have to register as an introducing broker simply because that person shipped code,” he said.

Benjamin Schiffrin watches the same numbers from Better Markets, an investor advocacy group. He directs the group's securities policy. His reading is stark. “There is now no question SEC enforcement activity during his first year in office reached a ten-year low,” he wrote⁴.

Schiffrin ties the crypto retreat to a wider one⁴. Chair Jay Clayton's SEC averaged 788 cases a year. Under Chair Gary Gensler, it averaged 706. Fiscal 2025 fell to 456.

Schiffrin's critique reaches past crypto, too⁴. The drop he tracked ran across the SEC's entire docket. Crypto cases were one slice of a much wider decline.

That wider decline leaves the pattern inside crypto itself standing. Cases that vanished went to the platforms with the most lawyers. One case stuck, and it went to the clubs with the least.

Coinbase felt an earlier version of this retreat first. The SEC dropped its case against the exchange on Feb. 27, 2025. Regulators filed the dismissal with prejudice, the kind that bars a refiling⁶. Acting Chair Mark Uyeda said the move would let the agency "reform and renew its regulatory approach to the crypto industry."

Kraken and Consensys had similar cases dismissed around the same time³. Brian Armstrong is Coinbase's chief executive.

Its political spending reaches further still. Coinbase funds Fairshake, the political fund backing crypto-friendly candidates ahead of the 2026 midterms⁷. Fairshake and its allied funds held $108 million on Aug. 31, 2026, backing 32 House candidates, 19 Republicans and 13 Democrats.

Fairshake's spokesman, Geoff Vetter, calls the project a success. “We back pro-crypto candidates who support American innovation in both parties. We've won 53 of the 57 races we engaged in this cycle and look forward to continuing to build on the largest pro-crypto caucus in American history,” he said.

The moral math runs in one direction. Coinbase profits twice, once when its own case closed, and again as Congress stays too divided to write a stricter one⁶. Selig and the CFTC gain a freer hand to write crypto's rules, now that Congress failed to vote on its own².

Investors in a Dec. 22, 2025 complaint carry the real risk¹. Three small trading platforms and four investment clubs took at least $14 million from retail accounts before the SEC filed that case. Enforcement still catches operators who steal outright. Big platforms rarely face that test anymore, now that the registration fights ended in dismissals.

The number itself holds up. Washington really did step back from crypto oversight in 2026, by every count Brattle logged¹. Who that step helped first is the real question. Platforms with lawyers and political funds led the list of winners. Account holders trailed them, after losing $14 million to schemes the SEC still had to catch by hand.

Readers who want that record followed, case by case, can join The Signal, CryptoLately's newsletter, at cryptolately.com/newsletter.

Sources

1. Riza Dagoc, "SEC Enforcement Actions Total an Estimated 308 in Fiscal 2026," TokenPost, Oct. 21, 2026, https://www.tokenpost.com/news/regulation/36817
2. Jesse Hamilton, "U.S. CFTC Joins SEC in Proposing Crypto Regulations, Though Spot-Market Gap Lingers," CoinDesk, Oct. 5, 2026, https://www.coindesk.com/policy/2026/10/05/u-s-cftc-joins-sec-in-proposing-crypto-regulations-though-spot-market-gap-lingers
3. Vince Dioquino, "SEC Says Prior Crypto Enforcement Set 'Misguided Expectations' As Actions Drop 22%," Decrypt, April 8, 2026, https://decrypt.co/363638/sec-says-prior-crypto-enforcement-set-misguided-expectations-as-actions-drop-22
4. Benjamin Schiffrin, "The SEC Is Supposed to Prevent Companies From Misleading Investors, But Its 2025 Enforcement Report Misleads the Public," Better Markets, April 21, 2026, https://bettermarkets.org/analysis/the-sec-is-supposed-to-prevent-companies-from-misleading-investors-but-its-2025-enforcement-report-misleads-the-public/
5. Sam Daodu, "CFTC Chairman Expresses Disappointment With Congress While Advancing Crypto Regulations," 24/7 Wall St., Oct. 7, 2026, https://finance.yahoo.com/markets/crypto/articles/cftc-chairman-expresses-disappointment-congress-100052588.html
6. Brayden Lindrea, "SEC Dismisses Lawsuit Against Crypto Exchange Coinbase," Cointelegraph, Feb. 27, 2025, https://cointelegraph.com/news/sec-dismisses-lawsuit-against-coinbase
7. Mark Schoeff Jr., "Crypto Super PAC Targets 32 House Races Before Midterms," The Hill, Oct. 5, 2026, https://thehill.com/policy/technology/6130147-fairshake-backs-house-candidates/