Original | Odaily
Author | jk
On January 21, local time in the US, SEC Commissioner Mark Uyeda replaced the outgoing SEC Chairman Gary Gensler, who officially left office on Monday, and will serve as Acting Chairman until Paul Atkins (Trump's nominee to replace Gensler) completes the Senate confirmation process. On the same day, Mark Uyeda announced the establishment of a Crypto Assets Working Group, with the aim of developing a clear and explicit US regulatory framework for crypto assets, which the crypto industry has long been hoping for. On January 22, local time, the nomination for another major US crypto regulator, the Commodity Futures Trading Commission (CFTC), was also released, with Harry Jung (also an Asian) being designated as the official responsible for crypto asset-related matters.
As soon as the news broke, the industry was abuzz. This article by Odaily will analyze the backgrounds of Mark Uyeda and Harry Jung, these two Asian leaders, and why this will be a major positive.
Who is Mark Uyeda? Will Mark Uyeda become the "Heavenly Mark"?
After President Trump's inauguration, his administration quickly nominated SEC Commissioner Mark Uyeda (a Republican) as Acting Chairman, according to a White House memorandum dated January 20, as part of a series of federal agency leadership changes in the new administration.
First of all, it can be confirmed that Mark Uyeda is a clear pro-crypto official.
Mark Uyeda (left) being sworn in as an SEC Commissioner. Source: YouTube
He has over 15 years of SEC experience and has supported the industry's position on several key events affecting the crypto industry. However, unlike the "Crypto Mom" Hester Peirce, Mark Uyeda is not as well-known in the industry.
But what has he done?
He voted in favor of the SEC's review of ETF approvals.
He and Peirce previously dissented in December 2023 against an SEC decision. At the time, Coinbase had requested that the SEC put crypto regulatory rules on its formal agenda and develop clear regulatory rules. However, the SEC rejected this request. Uyeda and Peirce believed the SEC had a responsibility to respond positively and develop clear rules.
He has expressed strong views on the SEC's role in the digital asset space. He has often criticized the SEC majority's regulatory actions against the crypto industry, such as the so-called Staff Accounting Bulletin 121 (SAB 121), which made it difficult for banks to serve digital asset clients. He has expressed support for rescinding this policy, and this decision is now within his purview.
Additionally, he previously established connections with the crypto field through his consulting business in Washington.
From the SEC's official statement, we can see that Mark T. Uyeda was born in Orange County, California, obtained a Bachelor of Business Administration degree from Georgetown University in 1992, and a Juris Doctor degree from Duke University Law School in 1995 with distinction. Early in his career, he worked as a lawyer in Washington and Los Angeles, later joining the California securities regulator, the California Department of Corporations, as Chief Counsel. During Trump's first term, he held senior roles at the US Treasury Department and the US Department of Labor. He also served as an outside advisor to the US Senate Banking, Housing, and Urban Affairs Committee. At the SEC, he has served as Senior Advisor to Chairman Jay Clayton, Legal Counsel to Commissioners Michael S. Piwowar and Paul S. Atkins, and Assistant Director and Senior Special Advisor in the Investment Management Division, before becoming an SEC Commissioner on June 30, 2022.
"Having served as a Commissioner since 2022 and as a staff member participating in the SEC's work since 2006, I am honored to serve in this capacity," said Mark T. Uyeda. "I have great respect for the SEC and its staff's knowledge, expertise, and experience. The SEC's mission is critical - protecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation, which plays a key role in driving innovation, creating jobs, and realizing the 'American Dream'."
Incidentally, his full name is Mark Toshiro Uyeda, clearly a Japanese surname. According to the common naming convention for Japanese Americans of putting the Japanese name in the middle name, his Chinese name translation should be Uyeda Toshiro.
According to usual practice, while an Acting Chairman has the same powers as the official Chairman, they typically choose to defer major decisions until the new Chairman is in place. This means that Mark Uyeda is likely to wait until Paul Atkins is confirmed before making major decisions like approving an ETF. If readers are curious about the new SEC Chairman Paul Atkins, I recommend reading this article: Understanding the New SEC Chairman Paul Atkins: Is the Crypto Industry Celebrating Too Early?
Gary Gensler's Somber Departure
Gary Gensler resigned as promised on the day of Trump's inauguration. Almost all the senior legal officials who worked under Gary Gensler, including staff from the Enforcement Division and the Office of the General Counsel, have now departed, suggesting his entire team has left. Reports indicate that the SEC's former Chief Economist Jessica Wachter and General Counsel Megan Barbero have also departed, while Chief Accountant Paul Munter is expected to leave on January 24.
Gensler's departure alone is enough to delight the crypto industry.
With these departures, compared to the SEC's "sister agency" the Commodity Futures Trading Commission (CFTC), the CFTC currently has a 2:2 balance between Republican and Democratic Commissioners, while the SEC has a 2:1 Republican majority over the sole Democratic Commissioner.
Since becoming a Republican SEC Commissioner in June 2022, Mark Uyeda has criticized Gary Gensler's rulemaking and enforcement approach. However, on the day of Gensler's departure, these Commissioners still gave the former Chairman enough dignity: "While we have differed on policy issues as Commissioners, our disagreements have always been conducted with dignity. Chairman Gensler has been committed to bipartisan cooperation and respectful intellectual discourse, which has enhanced our ability to serve the American public."
For Gensler's parting words, see: In the Final Countdown, SEC Chairman Gary Gensler Responds to 11 Key Questions About the Crypto Market.
The US Version of MiCA: A Clear and Explicit Crypto Asset Regulatory Framework
On Tuesday, Mark Uyeda announced the establishment of a "Crypto Assets Working Group", aimed at "developing a comprehensive and clear regulatory framework for crypto assets". The famous "Crypto Mom" Hester Peirce will lead this working group. According to the press release on Tuesday, the working group's goal is to provide clarity on registration requirements and practical solutions for entities seeking to register.
The SEC's statement was very concise and powerful, excerpted as follows:
Here is the English translation of the text, with the specified terms translated as requested:SEC Acting Chairman Mark T. Uyeda today announced the establishment of a Crypto Assets Taskforce, dedicated to developing a comprehensive and clear regulatory framework for crypto assets. SEC Commissioner Hester Peirce will lead this working group.
...
The working group, composed of talented staff from across the SEC, will collaborate with internal staff and the public to establish a legally sound and reasonable regulatory direction for the SEC.
To date, the SEC has primarily regulated cryptocurrencies through enforcement actions, taking a retrospective and passive approach, often employing novel and untested legal interpretations. This approach lacks clarity on registration requirements and practical solutions, leading to confusion over legality and creating an environment that is unfavorable to innovation and prone to fraud. The SEC can do better.
The working group's focus is to help the Commission define clear regulatory boundaries, provide viable registration pathways, develop reasonable disclosure frameworks, and deploy enforcement resources judiciously.
The working group will operate within the legislative framework set by Congress and provide technical support as Congress amends the framework. The working group will also coordinate with other federal departments and agencies (including the Commodity Futures Trading Commission), state entities, and international partners.
"I look forward to Hester Peirce Commissioner's efforts to lead the development of cryptocurrency regulatory policy, which involves multiple divisions and offices within the SEC," said Acting Chair Uyeda.
"This task will require time, patience, and significant effort. Success will only come if the working group is able to gather input from a wide range of investors, industry participants, academics, and other stakeholders. We look forward to working closely with the public to foster a regulatory environment that protects investors, facilitates capital formation, maintains market integrity, and supports innovation," said Hester Peirce Commissioner.
The working group plans to hold future roundtables and welcomes public input through Crypto@sec.gov.
Whether it's a clear and definitive regulatory framework or the SEC indicating a refusal to adopt a retrospective and passive regulatory approach (such as allowing Coinbase and exchanges to operate initially, but then immediately filing lawsuits when problems arise), it is something the entire crypto industry has been longing for. It is clear that the era of crypto-friendly regulation has arrived, and the United States will introduce a series of clear regulatory frameworks for crypto assets to clarify what can and cannot be done, thereby moving the crypto industry from the "Wild West" to a more standardized financial compliance product.
How long will this cycle last? By comparing with the EU's crypto regulatory framework, we can see that the EU's Regulation on Markets in Crypto-Assets (MiCA) was first published in June 2023, and after multiple industry consultations and applications, it will officially come into effect by the end of 2024. Therefore, if Mark Uyeda's working group can have the same efficiency, we will see the regulatory framework officially launched within this presidential term, and the entire industry will benefit from it.
Timeline of the implementation of the EU MiCA. Source: European Securities and Markets Authority
CFTC: Harry Jung, Another Pro-Crypto Official
CFTC vs. SEC: Who Regulates What?
Before introducing the second Asian executive, let's first explain the difference between the CFTC and the SEC.
The SEC (Securities and Exchange Commission) and the CFTC (Commodity Futures Trading Commission) are the two major regulatory agencies in the U.S. financial system, and their responsibilities and regulatory scopes are very different. The SEC's primary task is to regulate the securities market, protect investors, and maintain the fairness and transparency of the market. It oversees financial products defined as "securities," such as stocks, bonds, and options, and regulates the activities of securities exchanges, investment advisors, and brokers. Its regulatory basis is the Securities Act and the Securities Exchange Act, which clearly define the concept of "securities."
On the other hand, the CFTC focuses on regulating the commodity futures and derivatives markets. Its responsibility is to ensure that the futures, options, and derivatives markets are fair and transparent, while preventing market manipulation. The CFTC's regulatory basis is the Commodity Exchange Act (CEA), which defines the concepts of "commodities" and "derivatives," providing the CFTC with regulatory authority.
However, the emergence of crypto assets has blurred the regulatory boundaries between the SEC and the CFTC. Crypto assets have been oscillating between the definitions of securities and commodities; Bitcoin and Ethereum are viewed by the CFTC as "commodities" because they are often used as a store of value or a means of gas payment, similar to commodities like gold. However, certain crypto tokens, especially those issued through ICOs, may be more akin to securities because they involve investors providing funds to an entity and expecting profits from the efforts of others. According to the SEC's Howey test, these assets may be classified as securities.
One important reason why crypto assets are in a state of flux between the SEC and the CFTC is that current laws do not clearly define the classification of crypto assets. Both the SEC and the CFTC regulate crypto assets based on their respective legal frameworks, but since crypto assets may possess both securities and commodity attributes, their regulatory scopes inevitably overlap (and compete). This is why the "clear regulatory framework" mentioned earlier is so important.
Who is Harry Jung?
According to the CFTC's announcement, Acting Chair Caroline D. Pham today announced that Harry Jung will serve as Acting Chief of Staff. In addition to serving as the Chief Advisor to Acting Chair Caroline Pham, he will lead the CFTC's work in the areas of cryptocurrencies, decentralized finance (DeFi), and other digital assets, building on the foundation laid during his tenure as the designated federal official for the CFTC's Global Markets Advisory Committee.
Harry joined the CFTC in 2023, serving as an advisor and senior policy advisor to then-Commissioner Caroline D. Pham. Prior to joining the CFTC, Harry held various roles at Citigroup, including as a member of the CEO's office and the Chief Administrative Officer (CAO)'s office, and as the head of capital markets regulatory strategy and policy. In this role, he briefed the executive team on key market developments and impacts, and coordinated firm-wide working groups to address emerging issues and global policy forums. Harry also led the firm-wide working groups on emerging issues and global policy forums, and led regulatory interactions with U.S. prudential regulators and capital markets regulators on digital assets. Additionally, he led multiple cross-business and functional projects in the compliance department's regulatory liaison and examination management areas.
Prior to joining Citigroup, Harry worked at Morgan Stanley, where he conducted internal compliance inspections and developed policies for new activities in the wealth management business. He also previously worked at the Financial Industry Regulatory Authority (FINRA), leading examinations of broker-dealers to ensure compliance with securities regulations.
Based on Harry's background, he is also a pro-crypto official who has transitioned from the industry to the regulatory sphere. This also fully validates the Trump administration's commitment to the crypto industry, as evidenced by the appointment of pro-crypto personnel to key positions.
