Congress questions SEC crypto pullback as oversight concerns grow

House Democrats criticised the US Securities and Exchange Commission for scaling back crypto enforcement actions.

Lawmakers warned that dropped cases and delayed investigations could harm investors and weaken market confidence.

The concerns were outlined in a letter sent to SEC leadership questioning recent enforcement decisions.

Representatives said pausing or dismissing cases risks signalling selective or inconsistent regulatory oversight.

Lawmakers argued that reduced enforcement may embolden bad actors within the crypto sector.

The letter raised alarm over the impact on consumer protection amid growing crypto market participation.

Democrats said transparency is needed around why certain crypto-related cases were halted or abandoned.

The criticism comes as federal scrutiny of digital asset regulation intensifies in Congress.

Lawmakers urged the SEC to clarify its enforcement priorities and long-term regulatory approach.