U.S. regulators have ended a long-running investigation into Zcash, with the Securities and Exchange Commission deciding not to pursue enforcement action. The move removes a key regulatory cloud hanging over one of the crypto industry’s best-known privacy-focused projects.
Investigation ends without enforcement
The Zcash Foundation said this week that the SEC has formally closed its review into the project and will not recommend enforcement action or corrective measures. The inquiry began in August 2023, when the foundation received a subpoena tied to what the agency described as a matter involving certain crypto asset offerings.
In a public statement, the foundation said the conclusion reflects its efforts to operate transparently and remain compliant with applicable regulations. It added that its work will continue to focus on building privacy-preserving financial tools intended for public use.
A softer stance from regulators
The decision comes amid a broader pullback by the SEC from aggressive enforcement actions against crypto firms. Over the past year, the agency has dropped or wound down several high-profile investigations, signaling a more restrained approach under President Donald Trump’s administration.
Earlier this month, the SEC also ended a years-long probe into decentralized finance protocol Aave, reinforcing the perception that regulatory priorities are shifting. The Zcash Foundation did not disclose further details about the subpoena, and said it had not yet responded to requests for comment beyond its public notice.
Lawmakers push for clearer rules
While regulators step back from some enforcement cases, Congress is moving to clarify how digital assets should be overseen. On Thursday, the Senate Banking Committee is scheduled to mark up a bill aimed at defining the respective roles of the SEC and the Commodity Futures Trading Commission in crypto regulation.
The proposed legislation, known as the CLARITY Act, builds on earlier bipartisan efforts to establish a clearer market structure for digital assets. A parallel version of the bill is expected to be considered by the Senate Agriculture Committee later this month, with both panels required to agree before the measure can advance to a full Senate vote.