SEC Drops PayPal’s PYUSD Probe: Crypto Regulation Shift?
The US Securities and Exchange Commission (SEC) has ended its 16-month investigation into PayPal’s PYUSD stablecoin without taking enforcement action. This follows a subpoena issued in November 2023 requesting documents related to the stablecoin. PayPal cooperated fully, and the SEC closed its inquiry in February 2025, as revealed in a recent 10-Q filing. This decision aligns with a broader SEC shift in its approach to crypto regulation. The commission has concurrently dropped or closed several other crypto-related cases, citing the newly formed Crypto Task Force, led by Commissioner Hester Peirce, which is developing a regulatory framework for crypto assets. This change in strategy comes amidst a push by the US government to establish the nation as a global leader in the crypto space, mirroring promises made by President Trump to make America the “crypto capital of the planet.” The SEC and Department of Justice have even disbanded their crypto enforcement-focused units, moving away from a ‘regulation by enforcement’ approach. The legislative landscape is also evolving, with various crypto-related bills being introduced at both state and federal levels, including proposals for stablecoin regulations and the establishment of a Strategic Bitcoin Reserve. Bank of America’s CEO has also expressed the banking industry’s readiness to embrace crypto, indicating a potential willingness to issue stablecoins once a clear legal framework is in place. Recent reports even suggest that the Senate may vote on a stablecoin bill before the Memorial Day holiday, highlighting the accelerating pace of regulatory development in the US crypto market. The GENIUS Act, introduced by Senator Bill Hagerty, aims to create a regulatory framework for stablecoins like USDT and USDC under Federal Reserve Rules, furthering this regulatory evolution. In essence, the SEC’s decision regarding PayPal’s PYUSD reflects a broader shift toward a more comprehensive and potentially less adversarial regulatory approach to the crypto industry within the US.
(Source: https://bitcoinist.com/us-sec-ends-paypals-pyusd-stablecoin-probe-with-no-enforcement-action/)
