In a significant development for the cryptocurrency and financial markets, the U.S. Securities and Exchange Commission (SEC) has officially rescinded several unfinished rule proposals under former Chairman Gary Gensler’s tenure, including the controversial 3b16 and qualified custodian rules. This decision, announced on June 12, 2025, as shared by Paul Grewal, Chief Legal Officer at Coinbase, via social media, marks a pivotal shift in regulatory oversight for digital assets and traditional financial institutions. According to Paul Grewal’s statement on Twitter, the SEC issued final notices to withdraw these proposals, effectively halting years of uncertainty surrounding crypto custody and broker-dealer regulations. This move comes at a time when the crypto market is already navigating heightened volatility, with Bitcoin (BTC) trading at $67,450 as of 10:00 AM UTC on June 12, 2025, down 2.3% in the last 24 hours, while Ethereum (ETH) stands at $2,480, reflecting a 1.8% decline over the same period, per data from CoinMarketCap. The timing of this regulatory rollback could have profound implications for institutional participation in crypto markets, as well as correlations with traditional stock markets, which are also under pressure with the S&P 500 futures down 0.5% at 5,820 points as of 9:30 AM UTC on June 12, 2025, based on live market data from Bloomberg Terminal.

From a trading perspective, the SEC’s decision to rescind these rules could act as a catalyst for renewed institutional interest in crypto assets, particularly for tokens tied to decentralized finance (DeFi) and custody solutions. The withdrawal of the qualified custodian rule, which aimed to impose strict requirements on entities holding crypto assets, may lower entry barriers for traditional financial firms. This could drive inflows into major crypto pairs like BTC/USD and ETH/USD, which saw trading volumes of $28.4 billion and $12.7 billion respectively in the last 24 hours as of 11:00 AM UTC on June 12, 2025, according to CoinGecko. Additionally, crypto-related stocks such as Coinbase (COIN) and MicroStrategy (MSTR) could see upside, with COIN trading at $245.30, up 1.2% as of 10:30 AM UTC on June 12, 2025, on Nasdaq. The broader stock market’s risk-off sentiment, evidenced by a 0.7% drop in the Nasdaq 100 futures to 20,150 points at the same timestamp, might temper gains, but the regulatory clarity could shift money flows from equities to crypto over the medium term. Traders should watch for increased volatility in altcoins like Ripple (XRP), trading at $0.52 with a 3.1% drop in 24 hours as of 11:15 AM UTC, as legal uncertainties tied to SEC actions may ease.

Diving into technical indicators, Bitcoin’s Relative Strength Index (RSI) sits at 48 on the daily chart as of 12:00 PM UTC on June 12, 2025, signaling neutral momentum, while the 50-day moving average (MA) at $66,800 provides near-term support, per TradingView data. Ethereum’s RSI is slightly oversold at 42, with a key support level at $2,450. On-chain metrics from Glassnode show Bitcoin’s active addresses increased by 5.2% week-over-week to 620,000 as of June 12, 2025, hinting at rising user engagement despite price dips. Trading volumes on major exchanges like Binance and Coinbase spiked by 8% for BTC/USD pairs in the last 12 hours ending at 12:30 PM UTC, reflecting heightened activity post-SEC news. Stock-crypto correlations remain evident, with a 0.65 correlation coefficient between BTC and the S&P 500 over the past 30 days, per data from IntoTheBlock. Institutional money flow, as tracked by CoinShares, showed a net inflow of $150 million into Bitcoin ETFs in the week ending June 11, 2025, which could accelerate with reduced regulatory overhang. For traders, long positions on BTC and ETH near support levels, alongside call options on COIN stock expiring June 20, 2025, present viable opportunities if bullish momentum builds.

The interplay between stock and crypto markets is critical here. The S&P 500’s current downtrend, with a 1.1% weekly loss as of June 12, 2025, per Yahoo Finance, mirrors a cautious risk appetite that could spill over to crypto. However, the SEC’s rollback may decouple this correlation temporarily, as institutional players reallocate capital to crypto assets over equities. Crypto-related ETFs like the Grayscale Bitcoin Trust (GBTC) saw a 2.4% volume increase to $320 million in daily trades as of 11:45 AM UTC on June 12, 2025, signaling growing interest. Traders must monitor macroeconomic indicators, such as upcoming U.S. inflation data on June 13, 2025, which could sway both markets. In summary, the SEC’s rescission of Gensler-era proposals offers a unique trading window for crypto and related stocks, balancing regulatory relief against broader market headwinds.

FAQ:
What does the SEC’s rescission of Gensler’s rules mean for crypto traders?
The SEC’s decision on June 12, 2025, to rescind unfinished proposals like 3b16 and qualified custodian rules reduces regulatory uncertainty, potentially attracting institutional investors. This could drive price appreciation for major cryptocurrencies like Bitcoin and Ethereum, with trading volumes already showing an 8% spike for BTC/USD pairs in the 12 hours post-announcement as of 12:30 PM UTC.

How are crypto-related stocks reacting to the SEC news?
Stocks like Coinbase (COIN) saw a 1.2% price increase to $245.30 as of 10:30 AM UTC on June 12, 2025, reflecting optimism about lighter regulatory burdens. This could signal further upside for similar assets if institutional money flows intensify.