SEC THROWS IN THE TOWEL! Crypto Crackdown Crumbles! Case DISMISSED!

U.S. Securities and Exchange Commission Litigation Release No. 26277, dated March 27, 2025.

The SEC has dismissed its civil enforcement action against Consensys Software Inc. This decision was made as a policy matter to facilitate the SEC's reform of its crypto industry regulatory approach, not based on the merits of the case. The dismissal is with prejudice, meaning the SEC cannot refile the same claims.

In Plain English

The SEC decided to drop a lawsuit it had against a company called Consensys. They did this not because they thought the company did nothing wrong, but because they want to change how they handle rules for crypto companies. So, they closed the case and won't be suing Consensys for these specific issues again.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. SEC Initiates Enforcement Action On June 28, 2024, the Securities and Exchange Commission (SEC) filed a complaint initiating a civil enforcement action against Consensys Software Inc. in the United States District Court for the Eastern District of New York, case number 24-cv-04578.
2. SEC Establishes Crypto Task Force On January 21, 2025, the SEC's Acting Chairman Mark T. Uyeda launched a crypto task force. This initiative was dedicated to helping the Commission further develop its regulatory framework for crypto assets.
3. Parties File Joint Stipulation to Dismiss Subsequently, the SEC and Consensys Software Inc. respectfully submitted a joint stipulation to dismiss the litigation. This stipulation was filed on March 27, 2025.
4. SEC Exercises Discretion for Policy Reasons The SEC stated in the stipulation that its decision to seek dismissal was made in the exercise of its discretion and as a policy matter. This decision was intended to facilitate the Commission’s ongoing efforts to reform and renew its regulatory approach to the crypto industry.
5. Dismissal with Prejudice Pursuant to Fed.R.Civ.P. 41(a)(1)(A)(ii), the parties agreed that the litigation be dismissed with prejudice. This means the SEC cannot bring the same claims against Consensys again.
6. No Costs or Fees Awarded As part of the stipulation, both parties agreed that the dismissal would be without costs or fees to either party. Consensys also waived its rights to seek attorney's fees or other costs from the United States.
7. No Assessment of Merits The SEC explicitly noted that its decision to dismiss the case does not reflect an assessment of the merits of the claims originally alleged in the action. Furthermore, the Commission stated that this decision does not necessarily reflect its position on any other case.

The Enforcement Action

The SEC filed a civil enforcement action against Consensys Software Inc. on June 28, 2024. On March 27, 2025, the SEC and Consensys filed a joint stipulation to dismiss the action with prejudice. The SEC stated its decision was a policy matter to facilitate regulatory reform in the crypto industry and not an assessment of the merits of the claims.

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