Trump Nominates Former SEC Chair Jay Clayton as U.S. Attorney for Southern District of New York

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Former SEC Chair Jay Clayton has been nominated by Trump to be the U.S. Attorney for the Southern District of New York. This news comes from Sarah Wynn.

Klayton served as the head of the U.S. Securities and Exchange Commission from 2017 to 2020 during Trump’s first term. He’s notably known for initiating the case against Ripple.

The announcement was made on Thursday. Clayton’s experience includes overseeing significant regulatory actions during his time at the SEC. The Southern District of New York has dealt with many high-profile crypto cases, including actions against former FTX CEO Sam Bankman-Fried. Reuters was the first to report this news.

In a post on Truth Social, Trump expressed his support, saying, “I am pleased to announce that Jay Clayton, of New York, the Chairman of the U.S. Securities and Exchange Commission during my first term, where he did an incredible job, is hereby nominated to be the U.S. Attorney for the Southern District of New York.” He added that Clayton is a “highly respected business leader, counsel, and public servant.”

During his tenure, Clayton navigated the initial coin offering boom of 2017-2018. He led several high-profile lawsuits against various crypto projects. Notably, he took action against Kik and Telegram, which impacted their crypto efforts significantly.

Clayton also denied every application for crypto exchange-traded funds. Just before leaving the SEC, he filed charges against Ripple. In 2020, the SEC accused Ripple of raising $1.3 billion through the sale of XRP, which the agency claims is an unregistered security. This case is still ongoing, with both sides filing appeals after a New York judge granted a partial win to each.

Before his SEC role, Clayton was an attorney at Sullivan & Cromwell and served as a Federal Reserve advisor. He was chair when the DAO Report was released in July 2017. This report examined the decentralized autonomous organization known as "The DAO," which led to Ethereum rolling back its blockchain to recover stolen funds. It set a precedent for treating crypto assets issued through ICOs as securities.

On Wednesday, Clayton shared with a group of securities lawyers in New York that new crypto legislation is likely on the way. He expressed support for easing “regulatory burdens” to encourage companies to go public, as reported by Reuters.

During prepared remarks on Thursday, current SEC Chair Gary Gensler compared himself to Clayton. He noted that both have stated that bitcoin is not a security. Gensler also mentioned that Clayton initiated around 80 actions against individuals and firms in the crypto space.

It’s unclear whether Gensler will remain at the SEC, as Trump has said he would fire the current chair “on day one.” Sources suggest Gensler may step down, following the tradition of previous chairs, but he might choose to stay on as a commissioner.

Gensler stated, “His Commission and he spoke often about these markets, starting in his third month in office when the Commission put out the DAO Report. The SEC has continued that vigilance to ensure that those offering or selling securities comply with our time-tested securities laws.”

After leaving the SEC, Clayton took on the role of lead independent director at Apollo Global Management, a newly created position. He also rejoined Sullivan & Cromwell as a senior policy advisor and accepted advisory roles with crypto firms Fireblocks and One River.