Three Democratic lawmakers are accusing the Securities and Exchange Commission (SEC) of alarmingly backing off from enforcing crypto market laws. At the center of their criticism lies the prolonged suspension of proceedings against Justin Sun, founder of Tron.
A Decline in Rule Enforcement of Concern
In a letter to SEC Chairman Paul Atkins, representatives Maxine Waters, Sean Casten, and Brad Sherman decry the abandonment or setting aside of over a dozen crypto cases since early 2025. Among them are emblematic cases involving Binance, Coinbase, and Kraken.
According to the lawmakers, this retreat directly questions the regulator’s mission to protect investors: it gives the impression that some companies are now receiving more lenient treatment.
The Suspicion of Political ‘Pay-to-Play’
The core of the accusation is political. Democrats highlight that this regulatory pullback coincides with a surge in crypto sector political spending. According to their letter, sector companies contributed at least $85 million to President Donald Trump’s reelection campaign, while firms whose lawsuits were dropped reportedly donated at least $1 million each to his inauguration.
For the lawmakers, this overlap creates an ‘inescapable inference’: that of a ‘pay-to-play’ system, where political influence could lighten, or even erase, regulatory pressure.
The Case of Justin Sun in the Spotlight
The pause in Justin Sun’s case is the main focus of criticism. Charged in 2023 for unregistered offer and sale of crypto securities, volume manipulation, and illegal promotion through celebrities, Sun saw the SEC request a freeze on the proceedings in February 2025 to explore a potential settlement. Eleven months later, this freeze is still in place.
The Democrats believe this status quo sends a dangerous signal to the market: securities laws are no longer applied uniformly but based on political connections. They point out that Sun invested over $75 million in Trump-related crypto projects, including World Liberty Financial, in late 2024 and early 2025.
Also Concerns About National Security
Beyond financial concerns, lawmakers raise national security issues. They highlight Justin Sun’s alleged ties to China: participation in research programs of the Communist Party’s Central School, contributions to state media, and past statements indicating relations with Chinese officials.
In this context, they have also demanded the preservation of all internal documents and exchanges related to the decision to suspend the Sun case, including any communications with third parties who may have attempted to influence the case’s outcome.
Increasing Political Pressure on the SEC
This offensive marks a new stage in the politicization of the crypto regulation debate in the United States. For Democrats, the SEC’s credibility is at stake: either it demonstrates that its choices are based on clear legal criteria, or it risks being seen as a regulator vulnerable to political and financial interests.
In an already tense climate surrounding the Trump administration’s crypto policy, the Justin Sun case could become a broader symbol: one of the increasingly contested boundary between regulation, political power, and money in the digital assets ecosystem.
