In Bloomberg Law, Helen Gugel Examines Major Questions Doctrine in SEC Crypto Lawsuits

Two small cryptocurrency businesses concerned about enforcement actions have joined with trade groups to sue the U.S. Securities and Exchange Commission in Texas courts, challenging how the SEC regulates the crypto industry.

Trial judges in New York have recently sided with the SEC on some issues, including rejecting arguments that the regulation of crypto implicates the Supreme Court’s major questions doctrine, which says agencies must have clear authorization from Congress for an action with significant economic or political consequences.

In a Bloomberg Law article, litigation and enforcement partner Helen Gugel explains that “although New York courts in the Second Circuit have not appeared to be receptive to the major questions doctrine in crypto cases, courts in the Fifth Circuit may well have a different perspective and look at the doctrine with greater interest.”  This creates the potential for a split among appeals courts about whether securities laws apply to cryptocurrency that’s listed on an exchange that could lead to review at the U.S. Supreme Court.