Three U.S. House Democrats are accusing the Securities and Exchange Commission of retreating from its enforcement duties in the crypto sector and calling on Chairman Paul Atkins to explain its pullback from high-profile crypto cases — including the case against Tron founder Justin Sun.
In a Thursday letter to Atkins, House Representatives Maxine Waters, Sean Casten, and Brad Sherman expressed alarm over the SEC’s dismissal of more than a dozen crypto-related cases since early 2025, including litigation against Binance, Coinbase, and Kraken.
“Given the industry’s history of investor-harm and the clear mandate of the securities laws to protect market participants, this turn raises troubling questions about the SEC’s priorities and effectiveness,” the letter said.
The lawmakers argued that the SEC’s retreat has coincided with a surge in political spending by crypto firms, creating what they described as an “unmistakable inference of a pay-to-play scheme.”
According to the letter, crypto companies donated at least $85 million to President Trump’s reelection campaign, while firms whose enforcement actions were dismissed in 2025 — including Coinbase, Kraken, Ripple, Robinhood, and Crypto.com — each contributed at least $1 million to Trump’s inauguration.
Pressing Sun
The lawmakers focused particular attention on the SEC’s pause of its enforcement action against Justin Sun, saying the extended pause in the agency’s enforcement suggests that politically connected figures may be securing preferential treatment.
They noted that Sun invested more than $75 million in Trump-linked crypto ventures, including World Liberty Financial, in late 2024 and early 2025.
Sun was sued in 2023 for allegedly orchestrating the unregistered offer and sale of crypto securities, manipulating trading volumes, and engaging in unlawful celebrity promotion. In February 2025, the SEC requested a stay to explore a potential settlement.
“The SEC’s request to stay the Sun case, which has now been in place for 11 months, signals to the market that securities laws are enforced selectively, and that those with sufficient political influence can evade accountability,” the lawmakers wrote.
The Democratic lawmakers also raised national security concerns about Sun’s alleged ties to China, pointing to his involvement in research programs at China’s Central Party School, publications in state media platforms, and his past claims of connections to Chinese officials.
Alongside the letter, the lawmakers issued a separate document preservation request for all communications related to the decision to pause the Sun litigation, including any contacts with third parties attempting to influence the outcome.
The Block has reached out to a spokesperson representing Sun for comment.
© 2026 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Trade Crypto On Coinhub Exchange
Trade Crypto On Coinhub Exchange
Stay ahead of the market by turning news insights into trading opportunities. With Coinhub Exchange, you can seamlessly buy, sell, and manage your digital assets, all in one secure platform. Take advantage of real-time market insights, deep liquidity, and fast execution for your favorite cryptocurrencies. Don’t just read about it — trade crypto now!
Disclaimer
The content of this article shown by Coinhub News, powered by The Block, is for informational purposes only and should not be construed as financial, legal, tax, or investment advice. Coinhub News and its affiliates are not a licensed financial advisor, legal advisor, broker, or tax advisor, and ... should not be considered as professional advice or a recommendation to engage in any specific investment, legal decision, or financial transaction. Cryptocurrency markets are highly speculative and volatile. Readers should perform their own independent research and consult with a qualified professional before making any financial or legal decisions. The opinions expressed in this article are those of the author and do not necessarily represent the views or opinions of the Company of its affiliates. Additionally, the Company does not make any representations or warranties regarding the accuracy, timeliness, reliability, or completeness of any information in this article. By accessing this content, you acknowledge that any reliance on the information contained in this article is solely at your own risk. The Company is not responsible for any financial losses, legal disputes, or other damages that may arise from reliance on this content or from any investment or legal decisions based on the information provided. Investing in cryptocurrencies involves substantial risks, including the risk of losing your entire investment, and you should carefully consider whether it is appropriate for your circumstances.
Read more
