Ji Hun Kim, President and Acting CEO of the Crypto Council for Innovation (CCI), said that the U.S. Securities and Exchange Commission (SEC) has initiated more than 125 enforcement actions against digital asset firms without providing clear regulatory guidance or rulemaking. This statement was made in a written testimony submitted on February 11 to the House Financial Services Subcommittee on Digital Assets, Financial Technology, and Artificial Intelligence.
"However, more still needs to be done, to unwind the significant damage caused by the previous administration's “regulation by enforcement” approach," said Hun Kim. "The prior SEC leadership was quick to broadly assert its enforcement authority and suggest that many digital assets are securities without offering clear guidance regarding when an asset is, in fact, a security. During Chairman Gensler's tenure, the SEC initiated more than 125 enforcement actions related to digital assets but issued no clear guidance or rulemakings. This lack of regulatory clarity has driven companies offshore to jurisdictions."
According to Kim's testimony, the U.S. must establish a comprehensive federal regulatory framework for digital assets to provide clarity and certainty for the industry. The testimony discussed bipartisan progress in the 118th Congress, the global regulatory landscape, and the need to move beyond past enforcement-based approaches. Kim also outlined policy recommendations on market structure, stablecoin legislation, regulatory coordination, and support for decentralized finance (DeFi) technologies.
Under SEC Chair Gary Gensler, the agency has brought over 100 enforcement actions against the digital asset industry through 2023, making crypto firms a primary target of regulatory scrutiny. Data from HarrisX indicates that the U.S. digital asset industry spent more than $400 million defending against these enforcement actions, resulting in significant losses in jobs, innovation, and domestic investment. A Blockchain Association survey found that two-thirds of voters believe the SEC should wait for clearer guidelines from Congress, reflecting broad public support for a regulatory framework rather than enforcement-driven oversight.
Kim previously served as CCI’s Chief Legal & Policy Officer before stepping into his current role. Prior to joining CCI, he led legal, policy, and regulatory affairs at Gemini, a global digital asset exchange and custodian.
The SEC was established in 1934 under the Securities Exchange Act to regulate financial markets, enforce securities laws, and protect investors. The agency oversees public companies, securities exchanges, and investment firms to ensure compliance with reporting and anti-fraud regulations. While it has expanded its oversight to include digital assets and cryptocurrency markets, it has not yet implemented a dedicated regulatory framework for this industry.