The crypto industry is experiencing a significant regulatory shift, with major developments suggesting a more favorable landscape for digital assets. Recent decisions by the Securities and Exchange Commission (SEC) to drop its lawsuit against Coinbase and end its investigation into Robinhood’s crypto business signal a turning point for regulatory oversight in the space. As the dust settles, industry experts are closely watching for further changes that could shape the future of crypto. Here are three critical areas to monitor.

1. More SEC Lawsuits Could Be Dropped

The SEC’s retreat from its case against Coinbase may be just the beginning. Analysts predict that other lawsuits and investigations initiated under previous leadership could also be abandoned. Zack Shapiro, head of policy at the Bitcoin Policy Institute, suggests that the SEC’s ongoing cases against Binance and Kraken may be next in line for dismissal, given their similarities to the Coinbase case.

Regulatory expert Amy Lynch, founder of FrontLine Compliance, believes the SEC is working to redefine its stance on crypto. She anticipates that most digital assets will eventually be classified as commodities rather than securities, shifting oversight away from the SEC. One case to watch is the ongoing lawsuit against Ripple Labs, the issuer of XRP, which has long been considered a benchmark for determining whether most cryptocurrencies should be treated as securities.

A broader pullback in enforcement could also be on the horizon, with the Department of Government Efficiency (DOGE) potentially scrutinizing the SEC’s approach. Lynch speculates that this could lead to a more streamlined regulatory process and fewer aggressive enforcement actions in the near future.

2. Lawmakers May Establish a Regulatory Framework for Crypto

Momentum is building in Congress for clear-cut crypto regulations. Shapiro believes lawmakers are only a few years away from passing a comprehensive market structure bill that could significantly alter securities laws, effectively granting crypto tokens greater regulatory freedom.

A stablecoins bill appears to be the most imminent legislative milestone. According to Shapiro, David Sacks, the White House’s crypto czar, has emphasized that the administration is prioritizing regulations for stablecoins—cryptocurrencies pegged to traditional fiat currencies. The goal is to maintain the U.S. dollar’s dominance in global finance while creating a structured environment for digital asset stability.

Shapiro is confident that a stablecoins bill will pass this year, adding that such legislation would provide the clarity financial institutions need to enter the space. With regulatory uncertainty removed, banks and other institutions may begin competing with existing stablecoin issuers like Tether, injecting new liquidity and credibility into the market.

3. Crypto Prices Could See Increased Volatility

Regulatory clarity is generally good for markets, but the transition period could bring heightened price swings. Both Lynch and Shapiro anticipate that crypto prices could face temporary shocks as policymakers finalize new rules. Historically, regulatory moves—whether positive or negative—have often triggered short-term market turbulence.

Lynch warns that new legislation could initially cause a downturn in crypto prices, as markets react to changes in compliance requirements. However, she expects a recovery as investors adjust to the new framework.

Shapiro takes a more optimistic view, predicting that once a stablecoin bill is enacted, institutional investors will rush into the crypto space, driving renewed price momentum. “I’m sure all of the banks would like to do this and compete with Tether, but there’s not enough regulatory clarity. So once Congress passes the stablecoin bill, that’ll probably bring a lot of money in,” he said.

The Bottom Line

With the SEC stepping back from enforcement, lawmakers advancing new regulatory frameworks, and market volatility expected, the crypto industry is entering a period of transformation. While short-term price swings may occur, the long-term outlook appears increasingly favorable. As these developments unfold, investors and industry stakeholders will be watching closely to see how the next chapter of crypto regulation takes shape.