Donald Trump, crypto take aim at SEC as Biden allies raise alarms

On a cool, sunny June evening in San Francisco, the Pacific Heights mansion of venture capitalist David Sacks was the scene of an event that is rare to see in one of America’s most progressive cities: a high-dollar, Republican political fundraiser.

The guest of honor on this night was former President Donald Trump, who delivered formal remarks from a curtained stage to guests who had paid up to $300,000 to be there.

The presumptive Republican presidential nominee promised to loosen the regulation of cryptocurrencies if he is elected in November, and to “get out of the way of innovation,” a person who was in the room told CNBC. When he was finished, Trump invited the audience members to pipe up.

Stuart Alderoty, chief legal officer of the blockchain giant Ripple, explained the company had spent over $100 million defending itself in litigation brought by the Securities and Exchange Commission.

Alderoty’s comment was meant as a example of how the SEC’s regulatory actions under Chair Gary Gensler had hampered his company and the industry at large, according to a guest and a person familiar with the situation, who were granted anonymity to describe a private meeting.

As Alderoty spoke, a second crypto executive whose company is also fighting the SEC was in the audience: Paul Grewal, the chief legal officer of Coinbase.

In 2020, before President Joe Biden took office, the SEC accused Ripple and its founders of violating securities laws by acting as unregistered brokers of digital currency tokens, which the SEC regulates as securities. In 2023, the regulator filed a similar complaint against Coinbase, the largest U.S. crypto exchange platform.

The cases are ongoing, and both firms have denied they broke securities laws. Alderoty’s comments at the Trump fundraiser have not been previously reported, but he has made similar remarks elsewhere.

This frustration with Gensler’s regulatory agenda has taken on a political tenor this year, as crypto investors seek to exert more influence in Washington, D.C.

Trump has seized on this frustration in recent months, recasting himself from a crypto skeptic into a crypto supporter. Early signs show that shift is winning Trump support in the small but loud crypto community.

Some in the industry who are siding with Trump are going farther than just complaining about Gensler. Instead, they’re trying to shape the agency in a potential future Trump administration — starting at the top.

In recent weeks, crypto investors have raised several names of potential nominees for SEC commissioner, in the event that Trump is elected to a second term, according to three people who have knowledge of the conversations.

These names include two former chairs of the Commodity Futures Trading Commission during the Trump administration: J. Christopher Giancarlo and Heath…