Virtual asset policy efforts also 'all stop' amid U.S. shutdown

Analysts say that policy development related to virtual assets (cryptocurrencies) has effectively halted as the U.S. federal government's shutdown has suspended operations at major agencies, including the Securities and Exchange Commission (SEC).

On the 7th (local time), The Block reported that Jaret Seiberg, TD Cowen's senior analyst, said, "There is no likelihood that the SEC will resume work on significant policy changes in the virtual asset sector until a government budget agreement is reached."

The U.S. government entered a partial shutdown last week after Congress failed to pass a budget bill. As a result, many federal employees were furloughed, and the policy review and enforcement functions of major agencies, including the SEC, were also restricted.

Seiberg pointed out, "This shutdown does not simply cause delays equal to the number of days operations are suspended," adding, "Even if staff return, it will take considerable time to address accumulated issues and resume work."

Since earlier this year, following the start of the Donald Trump administration, the SEC has been reviewing exemptive relief for digital-asset firms issuing cryptocurrency-based new products and tokenized equities. However, related discussions have all been halted by this shutdown.

The SEC has entered an emergency-plan mode in which "only a very limited number of personnel are operating to respond to emergencies," and as a result, procedures such as approvals for spot virtual asset exchange-traded funds (ETFs) are also completely suspended.