The Securities and Exchange Commission (SEC) has announced that Chairman Gary Gensler will exit the agency on January 20, 2025, the same day President-elect Donald Trump will be sworn in.
While some pundits predicted that Gensler would exit sooner, giving another Commissioner a chance to lead the SEC before Republicans take over, it appears that Chairman Gensler will remain in place until the very last minute. His exit will be effective at noon ET on the 20th.
Chairman Gensler issued the following statement:
“The Securities and Exchange Commission is a remarkable agency. The staff and the Commission are deeply mission-driven, focused on protecting investors, facilitating capital formation, and ensuring that the markets work for investors and issuers alike. The staff comprises true public servants. It has been an honor of a lifetime to serve with them on behalf of everyday Americans and ensure that our capital markets remain the best in the world.”
“I thank President Biden for entrusting me with this incredible responsibility. The SEC has met our mission and enforced the law without fear or favor. I’ve greatly enjoyed working with my fellow Commissioners, Allison Herren Lee, Elad Roisman, Hester Peirce, Caroline Crenshaw, Mark Uyeda, and Jaime Lizárraga. I also thank Congress, my colleagues across the U.S. government, and fellow regulators around the world.”
The Fintech sector has long criticized Gensler’s tenure. He has focused on political issues to the detriment of capital formation and other pressing issues while managing digital assets with regulation by enforcement. Whomever takes over the Commission will be more amenable to innovation and change. In the exit statement, it is mentioned that Gensler led the SEC as it “brought actions against crypto intermediaries for fraud, wash trading, registration violations, and other misconduct.”
Gensler was formerly Chair of the Commodity Futures Trading Commission during the Obama Administration. He also was senior advisor to U.S. Senator Paul Sarbanes in writing the Sarbanes-Oxley Act (2002) and was undersecretary of the Treasury for Domestic Finance and assistant secretary of the Treasury from 1997-2001. At one point he worked for Goldman Sachs and prior to being appointed to the SEC, he was a professor of the Practice of Global Economics and Management at the MIT Sloan School of Management. While at MIT, Gensler taught a course on Fintech, so expectations for him to be a transformative leader of the SEC were high. These hopes were soon dashed as the SEC became very engaged with inside-the-beltway politics, with some observers claiming he was positioning himself to level up (perhaps as Secretary of the Treasury) if a Democrat had been elected as President.