SEC Chief Defends Enforcement Changes Amid Questions of Justin Sun Case

SEC Chairman Paul Atkins defended the agency’s legal changes as lawmakers questioned why Justin Sun’s case was put on hold.

US Securities and Exchange Commission (SEC) Chairman Paul Atkins is facing scrutiny from lawmakers as the agency tries to reshape its cryptocurrency regulatory framework.

Democrats are questioning possible links between industry actors and President Donald Trump amid a broader crackdown on enforcement actions.

SEC Investigated in Tron Case

During a House Financial Services Committee hearing, members of the Democratic Alliance spoke out against the SEC’s decision to drop the case against Tron founder Justin Sun. Representative Maxine Waters pointed to what she described as a rollback of previous crypto enforcement actions after Trump entered the White House and new SEC leadership took over last year.

Waters refers to the regulator’s 2023 lawsuit against Sun, in which he is accused of organizing unregistered sales of crypto securities tied to TRX and BTT tokens and manipulating trading prices.

Later in February 2025, the SEC asked the federal court overseeing the case to withdraw, halting the proceedings. Since that decision, Sun has become a major financial backer of crypto-linked crypto ventures, buying billions of WLFI tokens, making him a major backer of World Liberty Financial.

Waters also highlighted a recent claim by his ex-girlfriend, who publicly suggested she had evidence of TRX cheating.

Atkins declined to discuss specifics of the case, telling lawmakers that he could not comment on individual legislative issues. He added that he would be open to continuing discussions in a private setting “to the extent that the laws allow me to do so.”

You may also like:

When asked if the agency has done anything to protect investors in ways that could negatively affect businesses that do business with Trump, he replied, “Whether the Trump family does it or not, I can’t speak to that.”

Trump’s relationship with Binance

Lawyers also raised concerns about other high-profile SEC lawsuits dropped last year, including lawsuits against Binance, Ripple, Coinbase, Kraken, and Robinhood.

In May 2025, the financial regulator ended its lawsuit against Binance, which it had accused in 2023 of providing unlicensed services and distorting trading controls. Later Trump also pardoned Zhao, and the stablecoin issued by WLF was used by an Abu Dhabi investment company to invest 2 billion in Binance.

“Explain to me how this happened without enforcement action,” said representative Stephen Lynch. “The reputational damage the SEC is dealing with right now is unbelievable. And you’re sitting in the chair, sir. It’s your responsibility. I’m asking for an explanation.”

The SEC Chairman defended the regulator, saying it has a “vigorous enforcement effort” and continues to bring cases. However, data from Cornerstone Research shows that its overall legal actions will decrease by 30% in 2025, while crypto-related cases will fall by 60%.

Atkins, who became chairman of the agency in April 2025 after the departure of Gary Gensler, has been known to criticize the former’s aggressive approach and to label his leadership as a departure from tough tactics.