The crypto community has left no stone unturned in lambasting the US Securities and Exchange Commission (SEC) and, more importantly, its Chief Gary Gensler. The latter’s actions were dissented by members of his own agency.
Gensler even received political pushback for his actions. But the SEC boss continued to defend the crackdown on digital assets markets, saying he had never seen an industry so routinely break securities laws.
SEC Approach of Regulation by Enforcement
As Coinbase prepares for a court battle with the SEC, its CEO Brian Armstrong had some strong words for the regulatory agency. The executive believes the SEC has caused “untold harm” to the country by opting to regulate the digital asset space by way of enforcement rather than through proactive collaboration between regulators and industry leaders.
In a recent tweet, Armstrong said,
“Spent the day in DC meeting with members of Congress. We need regulatory clarity in the U.S. for the centralized players in crypto for many reasons – consumer protection, national security, economic growth, etc. The SEC has caused untold harm to America with its policy of regulation by enforcement. We will fight to fix that.”
The top executive at the biggest US crypto exchange also raised the prospect of relocating outside the country unless the regulatory climate changes after the SEC warned it of potential securities law violations.
Coinbase is not the only industry representative that has been critical of the financial regulator and its policies.
Web3 venture capital firm Paradigm recently said that SEC’s attempt to “brute force crypto assets that may not even constitute ‘securities’ into an ill-fitting disclosure framework is bad policy.” It also claimed that the agency failed to provide crypto entrepreneurs with a viable path to compliance.
Meanwhile, United States Representative Warren Davidson also announced his intention to introduce legislation to oust Gensler from his position in a bid to “correct a long series of abuses.”
SEC’s Crypto War
The SEC and Chairman Gensler’s crypto stance was heavily condemned by Republican members of Congress during Tuesday’s Congressional hearing. In the opening remark, the House Committee on Financial Services Chairman Patrick McHenry (R-NC) called the SEC’s approach to crypto exchanges “nonsensical” and lashed out at the lack of clarity.
Despite mounting criticisms, the agency remains unrelenting in its war on crypto. SEC Chair Gary Gensler defended the crackdown on cryptocurrency markets while reiterating his belief that the agency has sufficient authority to deal with the industry. He also maintained that regulatory clarity exists while adding that he had never seen an industry so routinely break securities laws.