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SEC Veteran David Hirsch Denies Joining Pump.fun Amid Trolls and Speculation Post-Retirement

Last Updated June 18, 2024 9:34 AM
Teuta Franjkovic
Last Updated June 18, 2024 9:34 AM

Key Takeaways

  • David Hirsch, who led the SEC’s crypto unit, stepped down after nearly a decade.
  • Rumors of him joining a memecoin platform were debunked.
  • He played a major role in the SEC’s enforcement against cryptocurrency, including high-profile cases like Coinbase and Solana.
  • Hirsch’s departure comes as the SEC faces increased political pressure related to crypto regulations and approvals.

David Hirsch, who led the Securities and Exchange Commission’s (SEC) Crypto Asset and Cyber Unit, has resigned  after nearly ten years of service.

Hirsch’s resignation comes amid intensifying scrutiny of cryptocurrency regulations and follows recent developments in the SEC’s legal battles with Ripple and other crypto companies.

SEC Crypto Chief Departs Amid Scrutiny, Denies Memecoin Job Rumors

Starting as a staff attorney in a regional SEC office, Hirsch played a pivotal role in guiding the SEC through the intricacies of cryptocurrency enforcement. His departure occurs at a crucial time for the SEC, which is under heightened political scrutiny as the presidential elections draw near.

David Hirsch announced his resignation from the Securities and Exchange Commission’s (SEC) Crypto Asset and Cyber Unit on LinkedIn this Monday. Soon after, rumors  circulated that he had taken a position as head of trading at the memecoin launch platform Pump.Fun.

Hirsch quickly addressed and dismissed these rumors on LinkedIn, stating , “This claim by pumpdotfun is false.”

Overseeing SEC’s Actions Against Coinbase & Solana

During his tenure at the SEC, Hirsch was involved in numerous high-profile enforcement actions within the cryptocurrency sector. Under his leadership, the Crypto Asset and Cyber Unit significantly grew in prominence as the SEC tackled the challenges of setting and enforcing regulations in the fast-evolving digital financial sector.

Hirsch oversaw enforcement actions against Coinbase and Solana. Last year in one of the podcasts  with the US investor and author Ric Edelman, Hirsch spoke of how SEC sued Coinbase  for selling Solana as an unregistered security.

He explained that the SEC alleged that Coinbase engaged in unregistered broker activity, unregistered clearing activity, and unregistered exchange activity in regard to Solana. However, it has not been alleged that Coinbase violated Section Five of the 1933 Securities Act, which pertains to the illegal issuance, offering, or selling of securities. The SEC’s claims focus on Coinbase performing exchange functions, applicable whether Solana is considered a security or similar to other tokens or securities. This identification is crucial for the SEC to establish its jurisdictional authority.
“We have alleged that they were performing exchange functions and that would be true whether it’s Solana as a security or any of the other tokens or securities. We just need to identify those things that we think are securities in order to establish our jurisdictional hook.”

Bad Guys Leaving?

The crypto community may or may not have reason to celebrate. It is true that the SEC, under Hirsch’s guidance has been dedicated to closely monitoring crypto exchanges and decentralized finance (DeFi) projects, particularly in light of recent legal actions against Coinbase Inc. and Binance. The enforcement office has shown heightened activity, with Hirsch making it clear that investigations are ongoing into other firms engaged in similar activities to those observed at Coinbase and Binance. He pointed out that compliance issues within the industry are not limited to these two entities alone.

However, the fact is that, even though cryptocurrency continues to be a significant political issue in the US, particularly in the lead-up to this year’s presidential elections, the spotlight remains on the SEC. The agency has recently faced pressure from lawmakers to approve spot Ethereum exchange-traded funds, with SEC Chair Gary Gensler often being viewed as a contentious figure among crypto advocates.

Other notable personnel changes include, Ladan Stewart, a former SEC lawyer noted for her involvement in high-profile cases against Ripple and Coinbase. Stewart has departed from the SEC’s enforcement division after an eight-year tenure. She has joined the law firm White & Case LLP as a partner.

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