U.S. Securities and Exchange Commission (SEC) Chair Paul Atkins is facing scrutiny from lawmakers as the agency moves to reshape its cryptocurrency regulatory framework.

Democrats are questioning potential links between industry actors and President Donald Trump amid a broader decline in enforcement actions.

SEC Scrutinized Over Tron Case

During a House Financial Services Committee hearing, Democratic members zeroed in on the SEC’s decision to pause its case against Tron founder Justin Sun. Representative Maxine Waters pointed to what she described as a sweeping rollback of prior crypto enforcement actions after Trump entered the White House and new SEC leadership took over last year.

Waters referenced the regulator’s 2023 lawsuit against Sun, in which he was accused of organizing the unregistered sale of crypto securities tied to the TRX and BTT tokens and manipulating trading volumes.

Later in February 2025, the SEC asked the federal court overseeing the case to issue a stay, which paused the proceedings. Since that decision, Sun has become a major financial supporter of Trump-linked crypto ventures, purchasing billions of WLFI tokens, making him the largest backer of World Liberty Financial.

Waters also highlighted a more recent claim by his alleged former girlfriend, who publicly suggested she possesses evidence of TRX manipulation.

Atkins declined to address specifics of the case, telling lawmakers he could not comment on individual enforcement matters. He added that he would be open to further discussion in a confidential setting “to the extent the rules allow me to do that.”

When asked whether the agency ever acts to protect investors in ways that could negatively affect Trump-affiliated businesses, he responded, “As far as what the Trump family does or not, I can’t speak to that.”

Trump’s Ties to Binance

Lawmakers also raised concerns about other high-profile litigation the SEC dropped last year, including cases against Binance, Ripple, Coinbase, Kraken, and Robinhood.

In May 2025, the financial watchdog ended its lawsuit against Binance, which it had sued in 2023 for offering unlicensed services and misrepresenting trading controls. Trump later also pardoned Zhao, while a stablecoin issued by WLF was used by an Abu Dhabi investment firm for a $2 billion investment in Binance.

“Explain to me how this happens without any enforcement action,” Representative Stephen Lynch said. “The reputational damage that the SEC is suffering right now is unbelievable. And you’re in the seat, sir. It’s your responsibility. I’m just asking for an explanation.”

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

Atkins, who became the organization’s chair in April 2025 after Gary Gensler’s departure, is known for criticizing the previous aggressive approach and framing his leadership as a move away from litigation-heavy tactics.

The post SEC Head Defends Enforcement Changes Amid Justin Sun Case Questions appeared first on CryptoPotato.

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Filed under: Bitcoin - @ February 12, 2026 8:05 pm