In mid-May 2026, two seemingly independent regulatory clues suddenly intersected: on one side, the SEC announced the repeal of the no-deny (also known as gag rule) settlement policy that had been in place for about 50 years, ending the tradition of "plead guilty but must not speak in defense" that had existed since the 1970s; on the other side, Senator Elizabeth Warren sent an open letter to Jonathan Gould, the head of the OCC, questioning whether the OCC's issuance of national trust licenses to multiple crypto companies had exceeded the authorized boundaries set by the National Bank Act. For all enforcement subjects that reached settlements with the SEC, including crypto companies, this meant an immediately effective change: after paying fines and accepting injunctions, they would no longer be forced to adhere to terms of "not disputing the charges," and could openly state objections to the facts and legal conclusions recognized by the SEC through public statements and communication with investors; for the first time, the voice of those being enforced against was systematically written back to the table. Meanwhile, the OCC, the regulatory body responsible for national banks and federal trust institution licenses, faced direct questioning from Congress regarding its practice of issuing national trust licenses to crypto companies—these licenses were originally seen as an important channel for crypto enterprises to enter the U.S. banking system under federal regulatory frameworks, with reports indicating that at least nine companies had been approved (this number comes from a single source and remains to be verified). Warren warned that some of these companies "seemingly do not qualify," suggesting that the OCC may have strayed from the legal path granted by Congress. Thus, a contradictory and specific scenario was presented to the crypto industry: companies and individuals that settled with the SEC had their discourse space widened; those applying for or already holding OCC trust licenses faced the risk that the licensing path could be tightened or even re-examined, resulting in a fragmented path for crypto regulation at the federal level, characterized by a simultaneous loosening of enforcement discourse and tightening of bank licensing, increasing the difficulty for the market to anticipate the future compliance route.
SEC's fifty-year gag order lifted
Since the 1970s, the no-deny rule has been almost embedded in the "details" of every significant settlement agreement from the SEC. If the investigated party chooses to settle, in addition to accepting conditions such as fines and behavioral injunctions, they must also sign an implied cost: they cannot deny or question the SEC's enforcement charges in public, or risk being deemed in violation of the settlement terms. Over fifty years, this clause, known in the industry as the "gag rule," has gradually evolved from a case-by-case arrangement into a standard template, giving the SEC stronger leverage in negotiations—once signed, the parties lost the ability to "plead their case" in media, investor communication, or even industry conferences, even if the case never entered a substantive trial in court, and what the outside world heard could only be the SEC's version of "facts."
This half-century-long gag mechanism was dismantled by the SEC around May 19, 2026. With the formal announcement of the repeal of the no-deny settlement policy, the new rules no longer require all settlement subjects to uniformly give up their right to publicly dispute the charges; parties achieving a settlement with the SEC can express differing views on the factual background and legal characterization of the case within the current legal and compliance frameworks. For the SEC, this means that a critical enforcement tool has been removed from its toolbox: future settlements will no longer automatically carry "silence costs" which may inevitably weaken enforcement deterrence and negotiation leverage; however, from the perspective of procedural fairness, practices that had been criticized for suppressing defendants' speech and undermining their reputational and rights defense space were terminated in a clean and decisive manner. This repeal of the no-deny rule equates to the SEC voluntarily relinquishing a sharp but heavily disputed weapon, placing its enforcement authority under a more public and contestable process.
Settlements no longer silenced: a new game for punished crypto entities
For crypto companies, after the SEC repealed the no-deny rule, the first thing rewritten was the old question: Should one spend years in litigation, or quickly accept penalties to resolve risks? Under the previous no-deny rule, once a settlement was chosen, it meant "self-incrimination" in the regulatory narrative; not only did they have to pay fines and remediation costs, but they also had to bear the long-term reputational burden of being unable to publicly refute the charges, which forced many companies to factor in the "silence costs" in their compliance budgets. Especially in cases involving unregistered issuance, platform operating without licenses, etc., the no-deny clause was often viewed as the hardest pill to swallow at the negotiation table: accepting a settlement could impact future license applications, partnership banking, and risk assessments by auditors; refusing to sign, on the other hand, meant embarking on a prolonged litigation with uncertain judicial outcomes.
The new rule changes the boundary of this trade-off. The SEC explicitly allows settling parties to publicly question or even deny the facts and legal characteristics of the enforcement charges via company statements, investor communication, or media voices without violating specific confidentiality terms, effectively giving the penalized entities a "plead guilty but not wrong" option card. For crypto companies, this means they can explain their legal stance and risk assessment to clients, partner banks, and auditing agencies while accepting fines and remediation arrangements, attempting to stabilize secondary market confidence and avoid being simply labeled as "violators." This change also compels the SEC to anticipate opposition from the counterpart when issuing enforcement settlement announcements; the previous discourse advantage of shaping a single "demonstration case" through press releases has been weakened, and the balance between enforcement deterrence and information transparency has been re-established: regulatory demonstrations may no longer set a definitive tone, but procedural fairness is perceived by more market participants; ultimately, a new round of games between the SEC and crypto enterprises surrounding "pleading guilty but not wrong" will be specifically drawn out in each settlement announcement and the subsequent public statement.
Warren's letter to OCC: questions raised over crypto trust licenses
As the SEC loosened enforcement discourse, the entrance to licensing on the other side tightened. Long known as a "financial regulatory hawk," Democratic Senator Elizabeth Warren simultaneously pointed her arrows at the OCC, directly addressing a letter to head Jonathan Gould, specifically questioning: did the OCC exceed the authorized boundaries of the National Bank Act in granting national trust licenses to multiple crypto companies? In the letter, she did not linger on abstract "risk concerns" but specified that some of the licensed entities "seemingly do not qualify," implying that these companies' business models, risk management, and even capital structures are fundamentally different from traditional trust institutions, yet were placed into the same regulatory bucket.
More damaging was her pointing toward potential legal consequences: if the OCC allows these companies to operate under a national trust shell, it may constitute overstepping the bounds of Congressional authorization. Public reports mentioned that the OCC had issued national trust licenses to at least nine crypto-related companies; although this number comes from a single source and the list has not been fully verified, it was magnified in Warren's letter into a compliance proposition—whether this is prudent openness or a disguised way to provide crypto companies a "federal pass" to bypass stricter regulation. Currently, there is no evidence showing that the OCC immediately halted all crypto trust approvals due to this pressure, but an open letter is sufficient to bring the OCC's licensing practices under scrutiny: each new license could be interpreted as a political probe into the boundaries of the National Bank Act, and the path that crypto companies originally hoped to "curve into" the banking system via national trust licenses must also be re-calculated amidst such political scrutiny and compliance uncertainty.
Trust licenses as a battleground for crypto companies to enter the banking system
For crypto companies, the national trust licenses issued by the OCC were originally seen as a hard-won "federal ticket": obtaining the license allowed them to legally provide asset custody, clearing, and settlement services to institutional clients under the OCC's regulatory framework, regarded by the market as one of the compliance gateways "into the U.S. banking system." Since the 2010s, the OCC began tentatively accepting crypto-related businesses within the existing banking regulatory framework, and by the 2020s, several entities reported being granted national trust licenses, with even a single source claiming that the OCC had approved at least nine crypto-related companies, making the path of "getting a federal trust license and then contacting Wall Street institutions" a core assumption for many trading platforms and custody institutions designing their U.S. business landscape.
Warren's public pressure disrupted this narrative. She directly questioned the OCC's practice of issuing national trust licenses to multiple crypto companies, warning that this could violate the National Bank Act, effectively throwing the question of "have you exceeded your authorization?" back to the OCC. The real compliance risk is that existing licensed agencies could be pulled back into license reviews at any time, the pace of approval for new licenses could slow, and if Congress or the courts determine that the OCC has overstepped its authority, they could be subject to more stringent business scope restrictions or face litigation challenges. Banks and institutional clients are also reinterpreting this game: once the federal trust qualifications of a cooperating entity are itself contested, continued use of its custody and settlement services could entangle them in regulatory conflicts and political struggles. Given that the specific list of related companies and license conditions has not been fully disclosed, it is challenging for external participants to judge which entities pose the highest risk, pushing them to plan cooperation and asset custody paths using more conservative risk assumptions, treating the once considered "safest" federal trust licenses as a regulatory battleground that could shift at any time.
Loosening on one side while tightening on the other: the disjointed progress of U.S. crypto regulation
The SEC's repeal of the half-century-old no-deny rule has given the enforced parties more room to "speak" during the post-enforcement phase: settlements no longer mean permanent silence; crypto companies can publicly question the charges themselves in announcements, financial reports, and even litigations, which could stretch many cases from one-time penalties into protracted tug-of-war involving regulatory narratives and judicial rulings. Almost simultaneously, Warren's pressure on the OCC advanced the gates to licensing, turning the legitimacy of national trust licenses into a political gate that may tighten at any time by questioning their validity. The result of the convergence of these two clues is that, at the federal level, there is neither a unified stance nor stable expectations regarding crypto issues in the U.S.: on one side, the SEC is "loosening" in procedure and discourse, while the OCC is being required to "tighten" on admissions and authorizations, tearing the industry compliance path into fragments that sway between different agencies. For crypto companies and cooperating traditional financial institutions, the next few years will require adaptation to both more intense public and judicial games, as well as higher uncertain licensing thresholds, leaving thicker legal and compliance buffers in cross-institutional business designs. What truly determines the trajectory of this landscape is not these two documents themselves, but how the SEC's new rules are implemented, how the OCC responds to questions, and whether Congress and the courts step in to redraw boundaries; these still unanswered questions will directly shape the next phase of survival coordinates for the U.S. crypto industry.
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