A federal judge decided to halt a lawsuit involving 18 state attorneys general and a decentralized finance lobbyist group against the U.S. Securities and Exchange Commission (SEC) on Wednesday, in light of the SEC’s new leadership.

The state attorneys general, who are all Republicans, filed the lawsuit alongside the DeFi Education Fund in November following Donald Trump’s victory in the 2024 presidential election. They claimed that the SEC had overstepped its authority by suing crypto exchanges. In a recent filing, the SEC hinted that the new agency chair, Paul Atkins, could bring an end to the legal action.

The judge instructed the parties to submit a joint status report within 30 days and paused all deadlines for 60 days.

Initially, the lawsuit argued that the SEC’s enforcement actions were encroaching on the jurisdiction of state regulators over digital asset firms in their respective states. The lawsuit highlighted the different regulatory approaches taken by states to oversee digital assets, emphasizing the need for clear and manageable regulatory frameworks.

Congress is anticipated to address market structure legislation pertaining to federal regulators’ oversight of crypto this year, with key committees already conducting hearings on the matter.

Meanwhile, the SEC has dropped investigations and lawsuits against more than a dozen companies and put lawsuits against others on hold.

In a separate development, a lawsuit filed by the DeFi Education Fund, the Texas Blockchain Council, and the Blockchain Association against the Internal Revenue Service (IRS) was also withdrawn. This lawsuit contested the IRS’ DeFi broker rule as exceeding the agency’s authority.

Last week, President Trump signed a resolution nullifying the IRS’ DeFi broker rule under the Congressional Review Act, marking his first legislative action related to crypto as president. Following this development, the parties involved in the lawsuit stated that the legal action had become “moot” and no longer necessary.