With Commissioner Peirce departing during such a busy time for the Commission, two questions immediately popped into my head: (1) Who will lead the Crypto Task Force? (2) What does this mean for Commission action?

The Crypto Task Force has already accomplished A LOT (especially with the Crypto Assets Proposed Rule sitting with OIRA), so perhaps the heaviest lift for the Crypto Task Force is in the rearview mirror at this point. Still, I assume someone will take over for the post-proposal phase.

On Commission action, I frankly just couldn’t remember what the SEC’s quorum requirements were. I’m not sure I’ve paid much attention to them before, but this won’t be the first time the SEC has found itself in a two-member situation. In 2016, the Commission was about to be down to two members, to which Broc said:

No worries. Back in the 90s, President Clinton was slow to nominate new members to federal agencies and the SEC dropped down to a level of two Commissioners for a spell – Chair Levitt & Commissioner Wallman. In order to get business done, the SEC amended its rules to accommodate the Commission when it drops to such a low level. “The Rule of 2” – adopted in 1995 – is still on the books:

§200.41 Quorum of the Commission.

A quorum of the Commission shall consist of three members; provided, however, that if the number of Commissioners in office is less than three, a quorum shall consist of the number of members in office; and provided further that on any matter of business as to which the number of members in office, minus the number of members who either have disqualified themselves from consideration of such matter pursuant to §200.60 or are otherwise disqualified from such consideration, is two, two members shall constitute a quorum for purposes of such matter.

So the quorum rules are different when there are three sitting Commissioners as compared to two. Thanks to Hunton & Williams’ Scott Kimpel for the help finding this rule…

As far as I can tell, this rule hasn’t been amended since 1995. Point being, it doesn’t sound like a two-member Commission will slow the pace of rulemaking!

– Meredith Ervine