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Crypto World

SEC’s Atkins Grilled on Crypto Enforcement Pullback as Justin Sun Case Draws Congressional Scrutiny

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TLDR:

  • SEC paused Justin Sun’s wash trading case in 2023 while exploring resolution, raising conflict concerns over Trump ties 
  • Atkins offered lawmakers confidential briefing on Sun case but cited regulatory restrictions on public discussions 
  • SEC dropped major enforcement actions against Binance, Ripple, Coinbase, rejecting previous regulation-by-enforcement approach 
  • Atkins confirmed SEC and CFTC are developing joint crypto rules aligned with House-passed Clarity Act framework

 

SEC Chairman Paul Atkins faced intense scrutiny from House lawmakers regarding the agency’s shift in cryptocurrency enforcement policies.

During Wednesday’s oversight hearing before the House Financial Services Committee, Democrats questioned the regulatory pullback on major crypto cases, particularly involving Tron founder Justin Sun.

Atkins defended the agency’s new direction while promising clearer regulations for the digital asset industry through collaboration with the CFTC.

Sun Case Raises Questions About Enforcement Priorities

Representative Maxine Waters, the committee’s ranking Democrat, pressed Atkins on the agency’s handling of the Justin Sun investigation.

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The SEC had accused Sun in 2023 of orchestrating wash trading schemes involving over 600,000 fraudulent transactions to inflate TRX token volumes. However, the agency paused the case last year while exploring potential resolution options.

Waters highlighted Sun’s connections to President Trump’s family through World Liberty Financial Inc. “Well, while you were exploring a potential resolution, Mr. Sun has been busy ingratiating himself within Trump’s orbit,” Waters said to Atkins during the hearing.

She questioned whether these ties influenced the SEC’s decision to halt enforcement actions. The California lawmaker also referenced recent allegations from Sun’s former girlfriend suggesting evidence of TRX manipulation.

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Atkins responded that regulatory restrictions prevented him from discussing specific cases publicly. He offered lawmakers a confidential briefing on the matter, stating he was willing to have further conversations “to the extent the rules allow me to do that.”

Waters pressed further, asking whether the SEC’s focus on real fraud extended to crypto markets. “Whatever involves securities,” Atkins responded.

The agency dropped several high-profile enforcement actions last year against major crypto firms including Binance, Ripple, Coinbase, Kraken, and Robinhood.

SEC leadership criticized the previous administration’s regulation-by-enforcement approach. When asked about protecting investors versus Trump business interests, Atkins stated, “As far as what the Trump family does or not, I can’t speak to that.”

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Regulatory Clarity Takes Center Stage

Republican committee members shifted focus toward Atkins’ plans for establishing comprehensive crypto regulations.

The chairman outlined ongoing coordination with the Commodity Futures Trading Commission to develop clear operational guidelines for digital asset companies.

These efforts align with the Clarity Act passed by the House, though the legislation’s Senate fate remains uncertain.

Atkins explained that both agencies are working on rules “consistent with what’s in the Clarity Act that you all passed here in the House, and hopefully what will come out of the joint work that you’re doing with the Senate.”

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He added that this effort would help provide certainty regarding jurisdictional boundaries between the two agencies. The framework would establish which types of digital assets fall under SEC or CFTC oversight.

The CFTC recently updated its guidance on stablecoins, allowing national trust banks to issue payment stablecoins and expanding eligible tokenized collateral.

Meanwhile, the National Credit Union Administration proposed rules for credit unions seeking stablecoin issuer status.

These moves implement provisions from last year’s GENIUS Act, marking the crypto sector’s first major legislative achievement.

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A policy race now develops between Atkins’ SEC and Senate lawmakers working on comprehensive crypto legislation.

Recent Senate delays may allow the SEC to lead in establishing digital asset regulations. The industry watches closely as regulatory frameworks take shape across multiple federal agencies.

 

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Crypto World

Franklin Templeton Expands Crypto Arm With CoinFund Deal

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Franklin Templeton Expands Crypto Arm With CoinFund Deal

Global asset manager Franklin Templeton is set to expand its crypto footprint by acquiring a spinoff of the crypto-native investment firm CoinFund.

Franklin Templeton said Wednesday it plans to acquire 250 Digital, a CoinFund spinoff that runs liquid crypto investment strategies, expanding the asset manager’s digital asset business. The deal will form part of a new unit called Franklin Crypto once it closes.

The move follows CoinFund’s decision earlier this year to spin out its liquid strategies business into 250 Digital as the company sharpened its focus on venture investing.

Christopher Perkins will lead the new Franklin Crypto, and Seth Ginns will serve as chief investment officer alongside Franklin Templeton digital assets veteran Tony Pecore, as the company broadens its crypto investment platform for institutional clients.

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The deal will incorporate BENJI tokens, which represent ownership shares in the Franklin OnChain US Government Money Fund (FOBXX), a regulated money market fund tokenized by Franklin Templeton in 2021.

Acquisition involves all liquid strategies previously run by CoinFund

Franklin said the undisclosed transaction includes the 250 Digital investment team and all liquid cryptocurrency strategies previously run by CoinFund, and that it will also invest in those strategies as part of the agreement.

The transaction is expected to close in the second quarter of 2026, subject to the execution of definitive transaction agreements, client consents and other customary closing conditions.

Source: Franklin Templeton Digital Assets

Franklin Templeton’s digital asset arm manages around $1.8 billion in assets and is a major institutional player in the crypto industry, where it has been building a presence since 2018.

The company is known for being one of the first to launch a US-listed spot Bitcoin ETF alongside other major asset managers such as BlackRock in 2024.

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Related: Franklin Templeton, Ondo to launch tokenized ETFs with 24/7 trading via crypto wallets

The acquisition comes during a prolonged slump in the crypto market, with Bitcoin down around 45% from its peak above $126,000 recorded in October 2025.

However, Franklin Templeton says the environment is attracting talent and creating opportunities to build long-term infrastructure.

Franklin’s head of innovation, Sandy Kaul, told The Wall Street Journal the recent market selloff helped create an opening to expand.

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“This big selloff that we had in the crypto markets is creating a very unique opportunity that really made us all decide that this is the right time to pull the trigger,” Kaul said.

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