Washington’s Pro-Crypto Reset: Pardons, Pullbacks, and the Weekly Regulation Roundup
Washington pivots—crypto's political winter thaws overnight.
### The Pardon Power Play
A surprise executive move cleaves through years of regulatory hostility. High-profile figures once facing prosecution now walk free, their convictions wiped from the ledger. It's not just a legal reset—it's a symbolic detonation at the foundations of the old enforcement regime.
### The Market's Calculated Retreat
Prices pull back from recent highs. Don't call it a crash—call it a liquidity breath-hold. Traders rotate capital, locking in gains while eyeing the next legislative catalyst. The dip-buyers are already circling, wallets open, smelling regulatory clarity in the D.C. air.
### Inside the Beltway Reset
Committee hearings shift tone from hostile to curious. Draft bills circulate with surprising speed, focusing on framework over friction. The message from key offices is no longer 'if' but 'how'—a seismic shift in political calculus that bypasses years of bureaucratic inertia.
It’s a fresh chapter, not a finished story. The real test isn't the headline, but the fine print—where traditional finance veterans will try to write rules that look innovative but protect their crumbling moats. For now, the winds have changed. The market just needs to decide if it's a breeze or a gale.
Trump Shows Openness to Reviewing Samourai Wallet Case
President Donald Trump has indicated he is willing to review a potential pardon for Keonne Rodriguez, founder and CEO of privacy-focused Bitcoin wallet Samourai, who was sentenced last month to five years in federal prison on money laundering charges.
During an Oval Office session on Monday, TRUMP responded to a reporter’s question by acknowledging awareness of the case and instructing Attorney General Pam Bondi to examine it.
While no formal review has been announced the remarks alone are notable given the broader context of crypto-related enforcement pullbacks under the Trump administration.
The Samourai case has become a flashpoint in debates over financial privacy, open-source software liability, and the limits of money transmission laws when applied to non-custodial tools.
Trump’s comments suggest the WHITE House may be open to reassessing cases viewed by parts of the crypto community as regulatory overreach.
Senate Confirms Mike Selig as CFTC Chair, Clearing Leadership Logjam
In a parallel shift, the U.S. Senate confirmed crypto-friendly lawyer Mike Selig as the next chair of the Commodity Futures Trading Commission ending months of leadership uncertainty at the derivatives regulator. The confirmation passed 53–43 as part of a broader slate of federal nominees.
The Senate finally confirms @MichaelSelig as the new @CFTC Chair, ending a long leadership vacuum and setting the stage for clearer U.S. crypto regulation. #CFTC #MikeSelig https://t.co/IvLEpQhesH
Selig is widely viewed as supportive of clearer market structure rules for digital assets and a more predictable regulatory framework. His arrival is expected to accelerate rulemaking around crypto derivatives and spot market oversight, particularly as jurisdictional debates between the CFTC and SEC remain unresolved.
This confirmation also clears the way for Acting Chair Caroline Pham to exit the agency and MOVE into the private sector.
Caroline Pham to Join MoonPay as Revolving Door Turns
Caroline Pham who has served as Acting CFTC Chair confirmed she will depart the regulator to join crypto payments firm MoonPay once Selig is sworn in. Pham wrote on X she looked forward to a smooth transition calling the future “bright.”
Her move shows the increasingly porous boundary between crypto regulation and industry, a dynamic likely to intensify as enforcement pressure eases and policy clarity improves. While such transitions raise perennial questions about the revolving door, they also reflect growing institutional confidence in the sector’s long-term legitimacy.
SEC Enforcement Retreat Accelerates Under Trump
Perhaps the most striking development came from a report indicating the Securities and Exchange Commission has dropped, paused, or dismissed nearly 60% of its crypto-related enforcement cases since Trump returned to office.
According to The New York Times while enforcement continues across traditional markets, crypto cases have been disproportionately affected. The shift is a sharp departure from the aggressive posture taken between 2021 and 2024, when the SEC pursued dozens of actions against exchanges, DeFi protocols, and token issuers.
The trend was reinforced this week by reports that the SEC has formally dropped its four-year investigation into AAVE following what sources described as a “significant” defense effort. Together, the developments point to a reassessment of litigation-heavy regulation in favor of clearer rules.
Fed Reverses Crypto Banking Restrictions, Custodia Back in Focus
The Federal Reserve also moved to unwind prior crypto restrictions, withdrawing its 2023 policy statement that effectively barred banks from engaging in crypto-related activities and blocked Custodia Bank’s master account application.
Vice Chair for Supervision Michelle Bowman said the reversal aims to support responsible innovation while maintaining safety standards. The move comes as Custodia continues to challenge its exclusion from the Fed system, amid broader scrutiny of “debanking” practices that sidelined crypto firms between 2020 and 2023.
The policy shift reopens the door for regulated crypto banks to access Core financial infrastructure — a critical step for institutional adoption.
Congress Targets Scams as Enforcement Focus Shifts
Even as agencies pull back from broad enforcement, lawmakers are signaling that fraud remains a red line. Senators Elissa Slotkin and Jerry Moran introduced the bipartisan SAFE Crypto Act, aimed at combating crypto-related scams after reported losses hit $9.3 billion.
The bill proposes a dedicated federal task force to improve coordination between regulators, law enforcement, and the private sector, reflecting a more targeted approach: protect consumers from fraud without stifling legitimate innovation.
A Regulatory Reset Takes Shape
Taken together, this week’s developments suggest a decisive pivot in U.S. crypto policy. Enforcement-first strategies are giving way to pardons, leadership changes, institutional access, and narrower fraud-focused oversight.
For the industry, the message is mixed but unmistakable: the era of blanket hostility is fading, but scrutiny is not disappearing — it is being reshaped.
