Trump’s Wall Street Regulators Set to Enter Rare GOP-Only Era

The two agencies most responsible for policing Wall Street will start the new year with only Republicans at the helm, marking the rare return of single-party dominance that is likely to endure as the regulators confront thorny new policy questions.

At the Securities and Exchange Commission, responsible for protecting investors in US stock markets, the sole remaining Democratic commissioner, Caroline Crenshaw, is set to depart after her term ends Jan. 3.

The SEC’s smaller sister agency, the Commodity Futures Trading Commission, will have only one person at the top—newly confirmed incoming Chairman Michael Selig—after acting Chairman Caroline Pham, a fellow Republican, left to join crypto payments company MoonPay.

Federal law says the agencies, designed to function with some political independence from the White House, can’t have more than three out of five commissioners from the same party. Presidents typically put forward nominees recommended by the opposing party to fill the other seats.

But there’s nothing stopping President Donald Trump from leaving the Democratic spots unfilled and further cementing his grip over Wall Street’s watchdogs. That would leave only Republican commissioners to implement some of the financial and crypto industry’s most contentious agenda items, including a digital asset market structure bill (H.R. 3633) poised for markup by the Senate Banking Committee early next year that would codify the SEC and CFTC’s jurisdictional boundaries for crypto assets.

“A bipartisan structure that is insulated from political pressure is the best approach, but it’s quite clear across a range of industries that we haven’t had that for a while,” said Jill E. Fisch, a University of Pennsylvania law professor who teaches corporate and securities law.

Republican-led financial agencies often take a lighter approach to enforcement and roll back regulations seen as hindering industry growth.

The SEC under Trump-appointed leaders has already redefined its role in digital asset oversight, drastically reduced enforcement in several areas, and launched an agencywide initiative to “make IPOs great again” by embracing mandatory arbitration while pushing less burdensome disclosure requirements.

The CFTC under Selig is poised to tackle new markets in crypto trading and betting on events including sports games and elections, without any Democratic input.

GOP Control

SEC Chairman Paul Atkins has suggested that a GOP-only commission won’t mean the total absence of debate, citing the benefits of disagreement between himself and fellow Republican commissioners Hester Peirce and Mark Uyeda.

“The more discussion, the better,” Atkins told reporters at the Blockchain Association’s policy summit in Washington this month. He noted the SEC “has not always had five commissioners.”

Commissioners in the minority can’t do much to “move the needle,” Fisch said. But Crenshaw has used her bully pulpit to oppose the agenda advanced by her GOP colleagues, warning in a Dec. 11 speech that “the darkest depths of winter still lie ahead for America’s capital markets.”

Crypto groups successfully lobbied the Senate to scrap a vote last year that would’ve reconfirmed Crenshaw for another term.

Agency watchers see the total alignment at the top as a rare but significant moment that could alter how the commissions enact their agendas under an administration unlikely to nominate new Democrats to fill the vacancies anytime soon.

Crenshaw and the agencies didn’t respond to requests for comment.

Atkins Acolytes

The remaining SEC commissioners, Uyeda and Pierce, have both made statements citing their track records working closely with Atkins, referring to time they spent as his counsel during a previous stint at the agency.

“There’s a great deal of philosophical alignment among the three of them because of their long history,” said Scott Kimpel, a partner at Hunton Andrews Kurth LLP and former counsel to ex-Commissioner Troy Paredes.

The SEC also found itself under GOP-only control for several months during Atkins’ previous tenure at the agency under George W. Bush’s administration, while Democrats alone ran the agency for more than half a year under Bill Clinton.

The reemergence of single-party control means the GOP commissioners can move in lockstep to quickly advance matters where minority commissioners typically voice dissent.

As for naming new Democrats to the vacant seats, Atkins is deferring to the White House.

“That’s beyond my pay grade,” he said at the Blockchain Association summit Dec. 9.

“If we could return to the position of, ‘these truly are bipartisan commissions and all five votes really matter, and all five viewpoints are blended and harmonized,’ that would be a good outcome,” Kimpel said. “I don’t think we are going to see that anytime soon.”

‘Party Line’ Over Dissent

Even with minority commissioners present, votes at the SEC have largely broken along partisan lines across recent administrations, calling into question how much both sides actually contribute to rulemaking and reach consensus on regulatory matters.

Dissenting votes come from commissioners of the same party 97% of the time, according to one paper analyzing SEC actions through 2019.

“As you look back in the 21st century, any of the major initiatives that the agency has pushed through have generally been on a party-line vote,” Kimpel said.

An extended stretch of one-party control in 2026 would only further chip away at the agencies’ longstanding reputation for political independence.

While the CFTC in particular could face logistical bottlenecks and legal challenges with only Selig at the top, both regulators have adopted rules to ensure they can function with just one or two members acting as a quorum.

If anything, Trump stands to gain even more control over the SEC and CFTC, as the US Supreme Court signaled at a hearing earlier this month that it is poised to empower the president to remove commissioners at traditionally independent federal agencies, casting doubt on a 90-year-old precedent.

“As we see the fiction that these are independent agencies tested by the administration, as we see Supreme Court cases that will likely give the president more power to hire and fire commissioners, it’s all going to change,” Kimpel said.