Where Do SEC’s Top Crypto Enforcers End Up? Defending the Crypto Giants They Once Targeted

Key Takeaways

• Former top SEC officials have transitioned to law firms representing major crypto companies.
• As more former SEC officials join private law firms, there is a clear trend toward specialized legal representation for cryptocurrency companies.
• Also, SEC chair Gary Gensler may quit, but don’t expect him to defend crypto companies.

A curious phenomenon has taken hold in the cryptosphere, where former top enforcers at the Securities and Exchange Commission (SEC) have made a surprising about-face, transitioning from crusaders to defenders of the very crypto giants they once targeted.

This revolving door has seen these seasoned professionals migrate to prominent law firms, where they now harness their insider expertise to champion the interests of major crypto players in the U.S.

Former SEC Enforcers are Now Defending Crypto Giants

Carolyn Welshhans Goes To Morgan Lewis

One of the most notable examples of this is Carolyn Welshhans, the former Acting Chief of the SEC’s Crypto Assets and Cyber Unit, who has joined Morgan Lewis, a prominent law firm with a strong focus on digital assets.

At Morgan Lewis, Welshhans focuses on securities enforcement issues, bringing her expertise to the fore in a market that is increasingly seeking clarity on the SEC’s jurisdictional bounds.

The firm has established itself as a leader in the digital assets space, with a deep understanding of the evolving legal framework.

In March, two partners from the firm—Fred Block and Ali Rivett— outlined the SEC’s ongoing legal battles against crypto companies. They emphasized that “crypto exchanges and other businesses operating in the crypto market would benefit from congressional legislation to clarify the SEC’s jurisdictional bounds.”

Gurbir Grewal Joined Milbank

The most recent departure from the SEC was Gurbir Grewal, the former Enforcement Director, who partnered with Milbank, a law firm currently representing Binance in a lawsuit that Grewal initiated.

Grewal targeted some of the industry’s biggest players, including Coinbase , Ripple, and Binance , accusing them of securities violations.

Grewal’s sudden exit has been met with a mix of praise and criticism. Republican Senator Tom Emmer, a vocal critic of the SEC’s approach to crypto regulation, tweeted that Grewal was at the forefront of “lawlessness and chaos” at the agency.

David Hirsch Left For McGuireWoods

David Hirsch, who previously led the SEC’s Crypto Assets and Cyber Unit, has transitioned to McGuireWoods. He now advises clients on crypto-related matters and cybersecurity regulations.

During his mandate at SEC, Hirsch was primarily responsible for matters relating to enforcement and digital assets.

Currently, he helps businesses navigate the evolving regulatory landscape surrounding digital assets.

Ladan Stewart Hired By White & Case

Ladan Stewart, known for her key role in the SEC’s cases against Coinbase and Ripple , has joined White & Case.

She helps clients navigate SEC enforcement actions related to cryptocurrencies.

The former SEC official uses her litigation experience to help organizations facing regulatory challenges, particularly as the SEC intensifies its scrutiny of crypto exchanges.

Steward served as Assistant Director and Regional Trial Counsel at the SEC’s Division of Enforcement, where she spearheaded the agency’s crypto and cyber litigation program.

As the founder and leader of the SEC’s first specialized crypto and cyber litigation unit, she was pivotal in shaping the agency’s enforcement strategy for these emerging areas.

Her experience includes litigating high-profile cases such as SEC v. Ripple , SEC vs. Telegram , SEC vs. Bankman-Fried , and SEC vs. Coinbase , showcasing her expertise in complex crypto-related legal matters.

George Canellos Defends Crypto Giant Binance

George Canellos , former head of the SEC’s enforcement division, now represents Binance in its legal battle with the SEC.

During his four and a half years at the SEC, Canellos held senior leadership roles. The most recent one was Co-Director of the Division of Enforcement. Before that, he served as Acting Director and Deputy Director.

He oversaw the SEC’s enforcement policies, supervising about 1,300 personnel across 12 offices. From 2009 to 2012, he led the New York Regional Office, managing 400 professionals handling enforcement actions and compliance inspections of major financial institutions.

Canellos was instrumental in key cases, including insider trading prosecutions involving Raj Rajaratnam and S.A.C. Capital, the SEC’s first action against a “dark pool” trading platform, and cases around CDO structuring and mortgage loan securitization.

He has worked closely with top officials from the United States Department of Justice (DOJ), Financial Industry Regulatory Authority (FINRA), Commodity Futures Trading Commission (CFTC), and international regulators, including the U.K. Financial Conduct Authority (FCA).

SEC Chair Gensler May Quit

Speculation is mounting that Gary Gensler, the current SEC chair, may be preparing to leave his post.

If so, the repercussions could be significant for the crypto industry, which has been a key focus of his tenure.

One potential candidate to succeed Gensler is billionaire entrepreneur Mark Cuban, a vocal critic of the SEC’s approach to regulating cryptocurrencies.

Cuban, a supporter of Vice President Kamala Harris, has accused Gensler of “pushing the crypto industry overseas” and “stifling growth in the capital markets” through his regulatory approach.

However, a different scenario could unfold if Donald Trump were to return to the White House.

Dan Gallagher , the chief legal officer of Robinhood, a former SEC commissioner, and a Trump appointee, could be in contention for the top job.

Given the SEC’s ongoing case against Robinhood, the irony of such an appointment would be palpable.

Other potential candidates for the SEC chair include J. Christopher Giancarlo, the former chairman of the CFTC, known for his pro-crypto stance and nicknamed “CryptoDad.” Current SEC Commissioner Hester Peirce , an advocate for clearer and fairer crypto regulation, could also enter the fray.