House Republicans are aiming to slash the Securities and Exchange Commission’s (SEC) 2026 budget by 7% and eliminate funding tied to enforcing a Biden-era rule that mandates public companies disclose cyber incidents.
On Monday, a House Appropriations subcommittee advanced a $23.3 billion funding proposal outlining fiscal year 2026 budgets for several agencies, including the SEC and the Treasury Department.
The plan represents an overall budget reduction of nearly 8%—roughly $410 million—compared to the current fiscal year ending September 30. Subcommittee Chair Dave Joyce said the move is part of an effort to “rein in wasteful spending.”
The move marks the GOP’s latest effort to roll back a range of regulations introduced under former President Joe Biden, including those affecting the crypto industry issued by the SEC.
On Monday, the Financial Services subcommittee approved the proposal along party lines, advancing it to the full House Appropriations Committee.
GOP Plan Slashes SEC Budget by 7% and Imposes Spending Restrictions
The proposed GOP plan would allocate just over $2.03 billion to the SEC for fiscal year 2026—a 7% reduction, or $153.9 million less than its 2025 budget.
In addition to the funding cut, the proposal includes several restrictions on how the SEC can use its funds. Notably, it would block spending on enforcing a rule adopted in mid-2023 that requires public companies and foreign private issuers to disclose cybersecurity incidents within four days, unless the disclosure poses a risk to national security or public safety. The rule also mandates annual reporting on cyber risk management practices.
The proposed funding falls short of the SEC’s recent budget request of $2.149 billion to support 4,101 full-time staff.
Banking Groups Pressured SEC to Scrap Cyber Disclosure Rule
In May, several banking advocacy groups called on the SEC to repeal the cybersecurity disclosure rule, claiming it had been “weaponized as an extortion tool by ransomware criminals to advance malicious aims.”
The rule has already had real-world consequences. Coinbase disclosed in May that some of its customer support contractors had been bribed to leak user data—an incident that triggered a wave of lawsuits against the crypto exchange. Coinbase said it refused a $20 million ransom demand tied to the breach and estimated potential damages could reach as high as $400 million.
Democrats Push Back Against Republican SEC Funding Plan
The Republican-led budget proposal would also block the SEC from using funds to collect personally identifiable information through its long-standing system for tracking equity and options trading.
Additionally, the plan would prohibit the agency from using its budget to craft new rules for private securities offerings.
House Appropriations Democrats criticized the proposal on X, calling it a “blow to everyday Americans” that would enable corporations to “skirt the law and hoard even more wealth.”
Ranking Member Rosa DeLauro added that the plan would allow “greedy corporations to cheat on their taxes, poison consumers, and continue to scam everyday Americans out of their hard-earned money.”
