In the Race for SEC Chair, Another Name Rises to the Top
One Trump nominee is advocating for another.
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Hey! I’m Veronica Irwin, Unchained’s regulatory reporter.
A contender for SEC Chair my sources were telling me just this morning was “not a lead candidate” is now, apparently, a top contender for the role. According to multiple sources, the list is getting shorter and shorter, and Trump might settle on an official pick soon.
Also, it looks like the race for another chair role is heating up—but that role’s in Congress, not a three-letter agency. More below.
Who Might Trump Pick for S.E.C. Chair? This Is Who Jay Clayton Hopes to See
Trump tapped Clayton, the SEC Chair during Trump’s first administration, for US Attorney for Manhattan on Thursday.
Rob Stebbins, a corporate lawyer at the New York law firm Willkie Farr & Gallagher LLP, has become a top contender on the increasingly short list for the next SEC Chair. According to one Washington insider, he has been strongly advocated for by his former boss Jay Clayton, who president-elect Donald Trump picked to be the top federal prosecutor in Manhattan Thursday.
Current chair Gary Gensler hinted at the Practising Law Institute Thursday that he would resign soon, leaving Trump the ability to nominate a new chair upon taking office in January. Trump had pledged to “fire” Gensler at the Bitcoin 2024 conference in Nashville this summer, even though he legally is not permitted to do so without cause.
Read More: The Trump-Connected Brad Bondi Is a New SEC Chair Contender and Pro-Crypto
It was a useful statement for Trump to make nonetheless, because Gensler has become a much hated-figure in the crypto industry after leading the charge to sue numerous crypto companies during his tenure, but not creating clear rules for digital assets. Trump’s desires to replace him garnered the industry’s support (and attracted a lot of donations). Stebbins is generally understood to be supportive of the crypto industry. In a RealClearMarkets op-ed he published in October, he criticized Biden’s financial regulators and especially Gensler for a policy of “regulation by enforcement,” in which Gensler had prosecuted crypto companies rather than “adopting reasonable, tailored rules that will allow digital asset innovation and consumer choice to flourish right here in America.” He also praised Trump for his embrace of the industry. “Relief cannot come soon enough,” he declared in the article.
Chatter on the Hill is growing louder for Stebbins and Brad Bondi, a lawyer at Paul Hastings, after former CFTC commissioner Chris Giancarlo announced on X he didn’t want the job and word spread that Dan Gallagher, chief counsel for the trading platform Robinhood, preferred his job in the corporate sector. Sources tell Unchained former commissioner Paul Atkins is also floating around as a potential pick, though it’s unclear if he’s being considered as seriously as Stebbins and Bondi.
Read More: A Degen Administration? Why the Crypto Czar May Be Allowed to Own Tokens
Stebbins was Jay Clayton’s General Counsel at the SEC, which is likely the cause for Clayton’s affection. He is also a colleague of Giancarlo’s at Wilkie Farr & Gallagher (they’re both “Wilkies,” as some lawyers fondly say), which could mean he is getting additional support from the former CFTC Commissioner.
Stebbins and Clayton did not respond to requests for comment by press time. Unchained will update this story with any later comments.
Rep. French Hill Says He’d Investigate Operation Choke Point 2.0 as Financial Services Chair
Hill and Kentucky Rep. Andy Barr are considered the two top contenders to lead the House Financial Services committee. (Official photo)
The Congressman is in a race with three other Republicans to lead a congressional committee that plays a key role in crypto legislation.
In his pitch to be elected Chair of the House Financial Services Committee Thursday, Arkansas Representative French Hill said he would “Make Community Banking Great Again” in part by investigating Operation Choke Point 2.0, an unofficial policy of bank regulators to stifle the crypto industry’s ability to access traditional banking services. Hill is competing with Kentucky Rep. Andy Barr, Oklahoma Rep. Frank Lucas, and Michigan Rep. Bill Huizenga to replace the current chair, North Carolina Representative Patrick McHenry, who is retiring.
The “political targeting” that Republicans say occurred under Obama-era Operation Choke Point, in which federal bank regulators placed additional regulatory scrutiny on industries such as payday lending and gun sales, has “continued under the Biden-Harris Administration to go after industries like firearms and digital assets,” Hill said in a document outlining his policy priorities. “Congress should fully investigate the conduct of agency personnel to find if their actions and policies were consistent with applicable laws, regulations, and policy, while the Trump Administration should officially halt and reverse this policy.”
Read More: Regulators are Limiting Banks Serving Crypto Clients. Does That Violate the Law?
Hill’s plan to respond to the hostility to crypto from bank regulators is the first bullet of 14 on his proposed policy agenda, signaling that it would be a top priority for Hill if he is elected Chair. Hill and Barr are widely considered the two top contenders in the race to lead the House Financial Services committee, and while both representatives are pro-crypto, Hill has a stronger record of working with the industry. Hill, for example, said on the Unchained podcast in July that stablecoin and market structure legislation would be the first two bills he would try to pass as Chair. Lobbyists who spoke to Unchained also said that Hill has deeper industry connections than Barr.
Barr has gained momentum since last week’s election, however, aided by his more outspoken support of president-elect Donald Trump. This puts Barr on slightly different terms with the MAGA wing of the Republican party than Hill, who has attracted slight suspicion of his loyalty to Trump after being one of just three lawmakers to vote “present,” rather than signaling direct support for Trump-backed House Speaker Mike Johnson last year and instead allying himself with former Speaker Kevin McCarthy. Notably, Barr introduced the Fair Access to Banking Act in April, which would explicitly disallow banks and financial services companies from discriminating against industries or persons operating legally, such as the crypto industry.
Read More: How Congressional Committee Leadership Could Shake Out for Crypto This Election
However, one source who has been meeting with House Representatives on behalf of the crypto industry described the competition between Hill and Barr as “friendly.” Each candidate will likely have several more weeks to make their case before Republicans vote by secret ballot, the source said, though the winner of the House Chair race will likely become apparent before it’s officially announced. “[Republicans] like to give all the candidates the time to run for school president, essentially,” the source said. “But they’ve been doing that for a year.” McHenry announced he would retire in December 2023.
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