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US lawmakers suggest SEC chair think about laws, not enforcement strategy to crypto


Two members of the US Home of Representatives have added their names to an inventory of lawmakers criticizing Securities and Trade Fee (SEC) chair Gary Gensler’s strategy to digital asset regulation.

In a letter to Gensler dated July 19, Representatives French Hill and Dusty Johnson suggested laws was a simpler strategy to addressing regulatory points within the digital asset area somewhat than the SEC’s place to “regulate by enforcement”. The 2 lawmakers are the respective chairs of subcommittees on Digital Property, Monetary Know-how and Inclusion and Commodity Markets, Digital Property, and Rural Growth with the Home Monetary Companies Committee and Home Agriculture Committee.

“Laws would do much more to stop future collapses of digital asset companies than enforcement actions,” mentioned the letter. “A statutory framework would set up a course of for companies to return into the regulatory parameter and adjust to shopper protections, somewhat than counting on enforcement actions to punish a nasty actor after the injury has already been executed.”

The SEC can’t proceed to control by enforcement. The lawsuits filed in opposition to digital asset companies usually are not defending the general public and are stifling innovation and development.

My letter to SEC Chair Gensler ⬇️

— Rep. Dusty Johnson (@RepDustyJohnson) July 19, 2023

Reps. Hill and Johnson hinted at sure actions by the SEC “seemingly timed to coincide with associated Congressional exercise, which seems calculated for optimum publicity and political impression”. Different members of Congress have questioned Gensler on the timing of the SEC’s fees in opposition to former FTX CEO Sam Bankman-Fried, given he had been scheduled to testify earlier than the Home Monetary Companies Committee in December 2022.

Associated: SEC’s Gensler supplied to function an adviser to Binance in 2019, legal professionals declare

The 2 lawmakers additionally referenced a “current abstract judgement” affecting crypto regulation, possible referring to an SEC v. Ripple ruling suggesting XRP was not essentially a safety. Within the wake of the court docket resolution, different Home Representatives have known as on Gensler to rethink the fee’s present strategy to regulating crypto. The SEC chair mentioned he was “disillusioned” within the ruling resulting from its impression on retail traders, and the fee can be assessing the scenario.

Lawmakers within the Home Monetary Companies Committee are contemplating a draft market construction invoice aimed toward clarifying the roles the SEC and Commodity Futures Buying and selling Fee would play in regulating crypto. The invoice has but to be formally launched, and could also be amended based mostly on suggestions from lawmakers and trade leaders.

Journal: Crypto regulation: Does SEC Chair Gary Gensler have the ultimate say?


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